POS AM

As filed with the Securities and Exchange Commission on April 20, 2020

Registration No. 333-215272

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

POST-EFFECTIVE AMENDMENT NO. 5 TO

FORM S-11

REGISTRATION STATEMENT

Under

THE SECURITIES ACT OF 1933

Cottonwood Communities, Inc.

(Exact name of Registrant as specified in its charter)

6340 South 3000 East, Suite 500

Salt Lake City, Utah 84121

(801) 278-0700

(Address, including zip code, and telephone number, including area code, of the registrant’s principal executive offices)

Enzio Cassinis

Chief Executive Officer

Cottonwood Communities, Inc.

6340 South 3000 East, Suite 500

Salt Lake City, Utah 84121

(801) 278-0700

(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies to:

Darryl Steinhause, Esq. DLA Piper LLP (US) 4365 Executive Drive, Suite 1100 San Diego, California 92121 (858) 677-1400 Robert H. Bergdolt, Esq. Laura K. Sirianni, Esq. DLA Piper LLP (US) 4141 Parklake Avenue, Suite 300 Raleigh, North Carolina 27612-2350 (919) 786-2000

Approximate date of commencement of proposed sale to public: As soon as practicable after the effectiveness of the registration statement.

If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act, check the following box.  ☒

If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act of 1933, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ☐

If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration number of the earlier effective registration statement for the same offering.  ☐

If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration number of the earlier effective registration statement for the same offering.  ☐

If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box.  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act (Check One):

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☒

This Post-Effective Amendment No. 5 consists of the following:    

1. The Registrant’s prospectus dated October 9, 2019.

2. Supplement No. 7 dated April 17, 2020 to the Registrant’s prospectus dated October 15, 2019.

3. Part II, included herewith.

4. Signature, included herewith.

Cottonwood Communities, Inc.

Maximum Offering of $750,000,000 of Shares of Common Stock

Cottonwood Communities, Inc. is a recently organized Maryland corporation that intends to qualify as a real estate investment trust beginning with the taxable year ending December 31, 2019. We operate under the direction of our board of directors. Our board of directors has retained CC Advisors III, LLC to conduct our operations and manage our portfolio of real estate investments, subject to the supervision of the board of directors. Our advisor is an affiliate of our sponsor, Cottonwood Residential II, Inc. We expect to use substantially all of the proceeds from this offering to invest primarily in existing multifamily apartment communities located throughout the United States and multifamily real estate-related assets. As of the date of this prospectus we own one multifamily community, a B note secured by a mortgage on a multifamily development project and a preferred equity investment in a multifamily development project.

We are offering up to $675,000,000 of shares of our Class A and Class T common stock in our primary offering for $10.00 per share without any upfront costs or expenses charged to the investor and an aggregate of $75,000,000 of shares of our Class A and Class T common stock pursuant to our distribution reinvestment plan at a purchase price initially equal to the purchase price of the shares in the primary offering or $10.00 per share. We are offering to sell any combination of our Class A and Class T common stock, with a dollar value up to the maximum offering amount. The share classes have different selling commission structures. Any offering-related expenses are paid by our advisor without reimbursement by us.

Investing in our common stock involves a high degree of risk. See “Risk Factors” beginning on page 20 to read about risks you should consider before buying shares of our common stock. These risks include the following:

• No public market exists for our shares and our board of directors is not required to provide our shareholders with a liquidity event by a specified date or at all.

• We set the offering price of our shares arbitrarily. This price is unrelated to the book or net value of our assets or to our expected operating income.

• We have little to no operating history and except as described in a supplement to this prospectus you will not have the opportunity to evaluate our investments before we make them, as we have not identified additional investments to acquire with the proceeds of this offering and are considered to be a “blind pool.”

• We depend on our advisor and its affiliates to select investments and to conduct our operations.

• We pay substantial fees to our advisor and its affiliates. These fees increase the risk that you will not earn a profit on your investment.

• Our officers and certain of our directors are also officers and directors of our sponsor, advisor and their affiliates. As a result, our officers and affiliated directors are subject to conflicts of interest.

• We have used and will continue to use leverage to acquire multifamily apartment communities, which increases your investment risk.

• There are restrictions on the ownership and transferability of our shares of common stock. See “Description of Shares – Restriction on Ownership of Shares.”

• Our charter permits us to pay distributions from any source, including offering proceeds or borrowings (which may constitute a return of capital), and our charter does not limit the amount of funds we may use from any source to pay such distributions. If we pay distributions from sources other than our cash flow from operations, we will have less funds available for investment. During the early stages of our operations, it is likely that we will use sources of funds which may constitute a return of capital to fund distributions. As of June 30, 2019, we have funded our distributions with offering proceeds.

• If we raise substantially less than the maximum offering amount, we may not be able to invest in a diverse portfolio of multifamily apartment communities and multifamily real estate-related assets and the value of your investment may vary more widely with the performance of certain assets.

Neither the Securities and Exchange Commission, the Attorney General of the State of New York nor any other state securities regulator has approved or disapproved our common stock, determined if this prospectus is truthful or complete or passed on or endorsed the merits of this offering. Any representation to the contrary is a criminal offense.

This investment involves a high degree of risk. You should purchase these securities only if you can afford a complete loss of your investment. The use of projections or forecasts in this offering is prohibited. Any representation to the contrary and any predictions, written or oral, as to the amount or certainty of any present or future cash benefit or tax consequences which may flow from an investment in this offering is not permitted.

	Price to Public(1)		Selling Commissions(2)		Dealer Manager Fee(2)		Selling Commissions and Dealer Manager Fee Paid by our Advisor(2)			Net Proceeds(2)
Primary Offering(3)
Class A Share, per share	$	10.00	$	0.60	$	0.30	($	0.90	)	$	10.00
Class T Share, per share	$	10.00	$	0.60	$	0.30	($	0.90	)	$	10.00
Total Maximum	$	675,000,000.00	$	40,500,000.00	$	20,250,000	($	60,750,000	)	$	675,000,000.00
Distribution Reinvestment Plan(3)
Class A Share and Class T Share, per share	$	10.00	$	0.00	$	0.00	$	0.00		$	10.00
Total Maximum	$	75,000,000.00	$	0.00	$	0.00	$	0.00		$	75,000,000.00

(1) Discounts are available for some categories of investors.

(2) The maximum selling commissions includes the deferred selling commission paid on the shares of Class T common stock sold in the primary offering. This deferred selling commission is subject to certain limits and conditions as described in the “Plan of Distribution” and will generally be paid in an annual amount equal to 1.0% of the estimated value per share for each Class T share sold in the primary offering for up to three years. We estimate that 85% and 15% of the gross proceeds raised in the primary offering is from the sale of Class A and Class T shares of common stock, respectively. As we are registering any combination of the two classes, this allocation is management’s best estimate based on the recommendation of our dealer manager and its perceived demand in the market for each respective class of shares.

Our advisor is responsible for paying the upfront and deferred selling commissions, dealer manager fee, and organizational and offering expenses without reimbursement by us. We do not use any of our offering proceeds to pay such expenses. The dealer manager fee includes compensation for acting as the dealer manager and for expenses incurred in connection with marketing our shares and for wholesaler compensation. The dealer manager may re-allow some or all of the dealer manager fees to the soliciting dealers. See “Plan of Distribution.”

(3) We reserve the right to reallocate shares of common stock between our distribution reinvestment plan and our primary offering.

The dealer manager, Orchard Securities, LLC, is not required to sell any specific number or dollar amount of shares. The shares are offered by our dealer manager on a “best efforts” basis. The minimum permitted purchase is $5,000.

This offering will terminate on or before August 13, 2020 (unless extended by our board of directors for an additional year or as otherwise permitted by applicable securities laws). If we decide to continue our offering beyond August 13, 2020, we will provide that information in a prospectus supplement. We may continue to offer shares under our distribution reinvestment plan after the primary offering terminates until we have sold $75,000,000 in shares through the reinvestment of distributions. In some states, we will need to renew the registration statement or file a new registration statement to continue this primary offering beyond the one-year registration period allowed in some states. We may terminate this offering at any time, and we will provide that information in a prospectus supplement.

The date of this prospectus is October 9, 2019.

TABLE OF CONTENTS

SUITABILITY STANDARDS	1
PROSPECTUS SUMMARY	3
RISK FACTORS	20
Risks Related to an Investment in our Common Stock	20
Risks Related to Conflicts of Interest	24
Risks Related to This Offering and Our Corporate Structure	26
General Risks Related to Investments in Real Estate	32
Risks Related to Multifamily Real Estate-Related Assets	36
Risks Associated with Debt Financing	38
Federal Income Tax Risks	41
Retirement Plan Risks	44
CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS	46
PLAN OF DISTRIBUTION	47
General	47
Compensation of Dealer Manager and Soliciting Dealers	47
Subscription Procedures	50
Suitability Standards	50
Minimum Purchase Requirements	51
ESTIMATED USE OF PROCEEDS	52
MANAGEMENT	54
Board of Directors	54
Executive Officers and Directors	55
Board Committees	58
Compensation of Directors	59
Limited Liability and Indemnification of Directors, Officers, Employees and Other Agents	59
Our Advisor	60
The Advisory Agreement	60
Initial Investment by Cottonwood Residential O.P., LP	61
Additional Investment by Cottonwood O.P., LP	62
MANAGEMENT COMPENSATION	63
STOCK OWNERSHIP	67
CONFLICTS OF INTEREST	68
Our Affiliates’ Interests in Other Cottonwood Real Estate Programs	68
Receipt of Fees and Compensation by our Advisor, Cottonwood Communities Advisors Promote, LLC and their Affiliates	70
Fiduciary Duties Owed by Some of Our Affiliates to Our Advisor and Our Advisor’s Affiliates	70
Affiliated Property Manager	70
Certain Conflict Resolution Measures	71
INVESTMENT OBJECTIVES AND CRITERIA	75
General	75
Charter-Imposed Investment Limitations	87
Investment Limitations under the Investment Company Act of 1940	88
PRIOR PERFORMANCE SUMMARY	90
Experience and Background of Cottonwood Residential O.P., LP	90
Prior Performance of Cottonwood Residential, Inc., Cottonwood Residential O.P., LP and their Affiliates	90
Prior Programs with Adverse Results	92
FEDERAL INCOME TAX CONSIDERATIONS	94
Taxation of Cottonwood Communities	94
Taxation of Shareholders	104
Backup Withholding and Information Reporting	111
Other Tax Considerations	112
ERISA CONSIDERATIONS	113
Prohibited Transactions	113
Plan Asset Considerations	114
Other Prohibited Transactions	116
Annual Valuation	116
DESCRIPTION OF SHARES	118

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General	118
Common Stock	118
Preferred Stock	120
Meetings and Special Voting Requirements	120
Advance Notice for Shareholder Nominations for Directors and Proposals of New Business	121
Inspection of Books and Records	121
Restriction on Ownership of Shares	121
Distributions	123
Tender Offer by Shareholders	124
Business Combinations	124
Control Share Acquisitions	125
Subtitle 8	126
Distribution Reinvestment Plan	126
Share Repurchase Program	128
Restrictions on Roll-Up Transactions	131
Registrar and Transfer Agent	132
THE OPERATING PARTNERSHIP AGREEMENT	133
General	133
Capital Contributions	133
Operations	133
Distributions and Allocations of Profits and Losses	133
Rights, Obligations and Powers of the General Partner	134
Change in General Partner	134
Amendment of Limited Partnership Agreement	134
SUPPLEMENTAL SALES MATERIAL	135
LEGAL MATTERS	135
WHERE YOU CAN FIND MORE INFORMATION	135

APPENDICES
APPENDIX A	FORM OF SUBSCRIPTION AGREEMENT	A-1
APPENDIX B	AMENDED AND RESTATED DISTRIBUTION REINVESTMENT PLAN	B-1
APPENDIX C	PRIOR PERFORMANCE TABLES	C-1

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SUITABILITY STANDARDS

The shares we are offering through this prospectus are suitable only as a long-term investment for persons of adequate financial means and who have no need for liquidity in this investment. Because there is no public market for our shares, you will have difficulty selling your shares.

In consideration of these factors, we have established suitability standards for investors in this offering. These suitability standards require that a purchaser of shares have either:

• a net worth of at least $250,000; or

• gross annual income of at least $70,000 and a net worth of at least $70,000.

In addition, the states listed below have established suitability requirements that are more stringent than ours and investors in these states are directed to the following special suitability standards:

• Alabama—Investors residing in Alabama may not invest more than 10% of their liquid net worth in us and our affiliates.

• California and Tennessee—Investors residing in California and Tennessee may not invest more than 10% of their net worth in us.

• Idaho—Investors residing in Idaho must have either (a) a liquid net worth of $85,000 and annual gross income of $85,000 or (b) a liquid net worth of $300,000. Additionally, the total investment in us shall not exceed 10% of an investor’s liquid net worth.

• Iowa—Investors residing in Iowa must have either (a) an annual gross income of at least $100,000 and a net worth of at least $100,000, or (b) a net worth of at least $350,000. In addition, the aggregate investment in this offering and in the securities of other non-publicly traded real estate investment trusts (REITs) may not exceed 10% of their net worth. Purchasers who are accredited investors as defined in Regulation D under the Securities Act of 1933, as amended (the “Securities Act”), are not subject to the foregoing concentration limit.

• Kansas—It is recommended by the Office of the Kansas Securities Commissioner that Kansas investors limit their aggregate investment in us and other non-traded real estate investment trusts to not more than 10% of their liquid net worth.

• Kentucky—Investors residing in Kentucky may not invest more than 10% of their liquid net worth in us or our affiliates.

• Maine—The Maine Office of Securities recommends that an investor’s aggregate investment in this offering and other similar direct participation investments not exceed 10% of the investor’s liquid net worth.

• Massachusetts—Investors residing in Massachusetts must limit their aggregate investment in us and other illiquid direct participation programs to not more than 10% of their liquid net worth.

• Missouri—No more than ten percent (10%) of any one (1) Missouri investor’s liquid net worth shall be invested in the securities being registered with the Securities Division pursuant to our registration statement.

• Nebraska—Investors residing in Nebraska who do not meet the definition of “accredited investor” as defined in Regulation D under the Securities Act must limit their aggregate investment in this offering and in the securities of other non-publicly traded REITs to 10% of such investor’s net worth.

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• New Jersey—Investors residing in New Jersey are required to have (a) a minimum liquid net worth of at least $100,000 and a minimum annual gross income of not less than $85,000; or (b) a minimum liquid net worth of $350,000. In addition, the total investment in us, our affiliates and other non-publicly traded direct investment programs (including REITs, business development companies, oil and gas programs, equipment leasing programs and commodity pools, but excluding unregistered, federally and state exempt private offerings) may not exceed 10% of their liquid net worth.

• New Mexico—Investors residing in New Mexico may not invest more than 10% of their liquid net worth in our shares, shares of our affiliates and other non-traded real estate investment trusts.

• North Dakota—Investors residing in North Dakota must have a net worth of at least ten times their investment in us.

• Ohio—Investors residing in Ohio may not invest more than 10% of their liquid net worth in us, our affiliates and other non-traded real estate investment programs. For these purposes, “liquid net worth” is defined as that portion of net worth (total assets exclusive of home, home furnishings, and automobiles minus total liabilities) that is comprised of cash, cash equivalents, and readily marketable securities.

• Oregon—Investors residing in Oregon may not invest more than 10% of their liquid net worth in us or our affiliates.

• Pennsylvania—Investors residing in Pennsylvania may not invest more than 10% of their net worth in us.

• Puerto Rico—Investors residing in Puerto Rico may not invest more than 10% of their liquid net worth in us, our affiliates, and in other non-traded REITs. For purposes of Puerto Rico’s suitability standard, “liquid net worth” is defined as that portion of net worth (total assets exclusive of primary residence, home furnishings, and automobiles minus total liabilities) consisting of cash, cash equivalents, and readily marketable securities.

• Vermont—Accredited investors in Vermont, as defined in 17 C.F.R. § 230.501, may invest freely in this offering. In addition to the suitability standards described above, non-accredited Vermont investors may not purchase an amount in this offering that exceeds 10% of the investor’s liquid net worth. For these purposes, “liquid net worth” is defined as an investor’s total assets (not including home, home furnishings, or automobiles) minus total liabilities.

For purposes of determining the suitability of an investor, “net worth” in all cases should be calculated excluding the value of an investor’s home, home furnishings and automobiles. Except as otherwise stated above, “liquid net worth” is defined as that portion of net worth that consists of cash, cash equivalents and readily marketable securities. In the case of sales to fiduciary accounts, these suitability standards must be met by the fiduciary account, by the person who directly or indirectly supplied the funds for the purchase of the shares if such person is the fiduciary or by the beneficiary of the account.

Our sponsor, those selling shares on our behalf and soliciting dealers and registered investment advisors recommending the purchase of shares in this offering must make every reasonable effort to determine that the purchase of shares in this offering is a suitable and appropriate investment for each shareholder based on information provided by the shareholder regarding the shareholder’s financial situation and investment objectives. See “Plan of Distribution—Suitability Standards” for a detailed discussion of the determinations regarding suitability that we require.

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PROSPECTUS SUMMARY

This summary highlights information contained elsewhere in this prospectus. You should read the entire prospectus, including the information set forth in “Risk Factors,” for a more complete understanding of this offering. Except where the context suggests otherwise, the terms “we,” us” and “our” refer to Cottonwood Communities, Inc. and our subsidiaries; “Operating Partnership” refers to our operating partnership, Cottonwood Communities O.P., LP; “advisor” refers to CC Advisors III, LLC, “sponsor” refers to Cottonwood Residential II, Inc.; “shareholder(s)” refers to the holders of the shares of our common stock.

What is Cottonwood Communities, Inc.?

Cottonwood Communities, Inc. is a recently formed Maryland corporation that intends to invest primarily in existing multifamily apartment communities located throughout the United States and multifamily real estate-related assets. As of the date of this prospectus we own one multifamily community, a B note secured by a mortgage on a multifamily development project and a preferred equity investment in a multifamily development project. Because we have a limited portfolio of investments and, except as described in a supplement to this prospectus, we have not identified any additional assets to acquire with the proceeds from this offering, we are considered to be a “blind pool.” We are an “emerging growth company” under federal securities laws.

We intend to elect to be taxed as a real estate investment trust, or REIT, under the Internal Revenue Code of 1986, as amended, beginning with the taxable year ending December 31, 2019.

We plan to own substantially all of our assets and conduct our operations through Cottonwood Communities O.P., L.P., which we refer to as our Operating Partnership in this prospectus. We are the sole general partner of the Operating Partnership and, as of the date of this prospectus, Cottonwood Communities Investor, LLC, a wholly owned subsidiary of Cottonwood Residential O.P., LP, the operating partnership of our sponsor, is the sole limited partner of the Operating Partnership. Except where the context suggests otherwise, the terms “we,” “us,” “our” and “our company” refer to Cottonwood Communities, Inc., together with its subsidiaries, including the Operating Partnership and its subsidiaries, and all assets held through such subsidiaries.

Our external advisor, CC Advisors III, LLC, conducts our operations and manages our portfolio of investments. We have no paid employees.

Our office is located at 6340 South 3000 East, Suite 500, Salt Lake City, Utah 84121, and our main telephone number is (801) 278-0700.

What are our investment objectives?

Our investment objectives are to:

• preserve, protect and return invested capital;

• pay stable cash distributions to shareholders;

• realize capital appreciation in the value of our investments over the long term; and

• provide a real estate investment alternative with lower expected volatility relative to public real estate companies whose securities trade daily on a stock exchange.

In general, our board of directors may revise our investment policies without the approval of our shareholders. However, we may not amend our charter, including any investment policies that are provided in our charter and described under “Investment Objectives and Criteria—Charter-Imposed Investment Limitations” without the concurrence of holders of a majority of the outstanding shares entitled to vote.

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What is our investment strategy?

We will use the proceeds of this offering to invest directly or indirectly in multifamily apartment communities and multifamily real estate-related assets located throughout the United States. We believe that current market dynamics and underlying fundamentals suggest the positive trends in United States multifamily housing will continue. See “Investment Objectives—Multifamily Focus” for a discussion of these trends. As of the date of this prospectus we own one multifamily community, a B note secured by a mortgage on a multifamily development project and a preferred equity investment in a multifamily development project. Additional information about our portfolio is available in a supplement to this prospectus.

Our primary investment vehicle is our operating partnership. In certain circumstances, we may acquire assets through joint ventures, mergers or other types of business combinations. The investments will be comprised primarily of stabilized multifamily apartment communities and land which will be developed into multifamily apartment communities. The strategy may also include mortgage or mezzanine loans to, or preferred equity investments in, entities that have been formed for the purpose of acquiring or developing multifamily apartment communities. We will seek to acquire, develop and actively manage these investments, with the objective of providing a stable source of income for our shareholders and maximizing potential returns upon disposition of the assets through capital appreciation. Generally, proceeds from the sale, financing or disposition of investments will be reinvested in a manner consistent with our investment strategy, although such proceeds may be distributed to the shareholders in order to comply with REIT requirements.

We will seek to invest at least 65% of our assets in stabilized multifamily apartment communities and up to 35% in mortgage loans, preferred equity investments, mezzanine loans or equity investments in a property or land which will be developed into a multifamily apartment community (including, by way of example, an existing multifamily apartment community that may require redevelopment capital for strategic repositioning within its market). We do not expect to be able to achieve the balance of these allocations until we have raised substantial proceeds in this offering. Prior to that time, we will balance the goal of achieving our portfolio allocation targets with the goal of carefully evaluating and selecting investment opportunities to maximize risk-adjusted returns. Notwithstanding the foregoing, the actual portfolio allocation may from time to time be outside the target levels provided above due to factors such as a large inflow of capital over a short period of time, the advisor’s or board of directors’ assessment of the relative attractiveness of opportunities, an increase or decrease in the relative value of an investment or limitations or requirements relating to our intention to be treated as a REIT for U.S. federal income tax purposes. Furthermore, our board of directors may revise the targeted portfolio allocation from time to time, if it determines that a different portfolio composition is in our shareholders’ best interests.

We will target properties located in major metropolitan areas in the United States that have, in the opinion of the advisor and our board of directors, attractive investment dynamics for multifamily apartment owners. We do not intend to designate specific geographic allocations for the portfolio. Our advisor intends to target regions where it sees the best opportunities that support our investment objectives and will attempt to acquire multifamily apartment communities in diverse locations so that we are not overly concentrated in a single area (though we are not precluded from owning multiple properties in a particular area).

What policies will you follow in implementing your investment strategy?

Our advisor operates pursuant to a philosophy that location, investment time horizon, asset-specific attributes and appropriate leverage are fundamental drivers of long-term value creation in real estate. These principles drive the material aspects of our advisor’s investment decision-making process. See “Investment Objectives—Investment Philosophy and Life Cycle” for a discussion of these principles.

Once a potential investment has been identified, our advisor will engage in a rigorous due diligence process. Although due diligence procedures are customized for specific elements of each deal, our advisor will follow traditional due diligence processes (physical, market, financial, environmental, zoning, insurance, tax, legal, etc.) in considering investments for us. Our advisor may outsource certain due diligence items to specialized consultants or third-party service providers, as needed, to support the diligence effort. Our advisor’s diligence focuses on three customary areas: financial, physical, and legal and tax. Additional information about these focuses is available at “Investment Objectives—Investment Philosophy and Life Cycle.”

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We intend to finance the purchase of multifamily apartment communities with proceeds of this offering and loans obtained from third-party lenders. We anticipate the use of moderate leverage to enhance total cash flow to our shareholders. We will target an aggregate loan-to-cost or loan-to-value ratio of 45% to 65% at the REIT level; provided, however, that we may obtain financing that is less than or exceeds such ratio in the discretion of our board of directors if the board of directors deems it to be in our best interest to obtain such financing. Although there is no limit on the amount we can borrow to acquire a single real estate investment, we may not leverage our assets with debt financing such that our borrowings are in excess of 300% of our net assets, unless a majority of our conflicts committee finds substantial justification for borrowing a greater amount and such excess borrowings are disclosed in our next quarterly report, along with the conflicts committee’s justification for such excess. Examples of such a substantial justification include obtaining funds for the following: (i) to repay existing obligations, (ii) to pay sufficient distributions to maintain REIT status, or (iii) to buy an asset where an exceptional acquisition opportunity presents itself and the terms of the debt agreement and the nature of the asset are such that the debt does not increase the risk that we would become unable to meet our financial obligations as they became due. We anticipate that all financing obtained to acquire stabilized multifamily apartment communities will be non-recourse to our operating partnership and us (however, it is possible that some of these loans will require us to enter into guaranties with respect to certain non-recourse carve-outs). We may obtain recourse debt in connection with certain development transactions.

We may obtain a line of credit or other financing that will be secured by one or more of our assets. We may use the proceeds from any line of credit or financing to bridge the acquisition of, or acquire, multifamily apartment communities and multifamily real estate-related assets if our board of directors determines that we require such funds to acquire the multifamily apartment communities or real estate-related assets. As of the date of this prospectus we are party to a credit facility in the amount of up to $36 million. Additional information regarding our current outstanding debt obligations is included in a supplement to this prospectus.

Our advisor will underwrite long-term hold periods for our investments (generally, five to ten years for stabilized operating communities and equity investments in developments, and three to four years for preferred equity or mezzanine debt investments). Our advisor will seek to avoid investment return profiles for stabilized multifamily apartment communities that depend primarily on significant appreciation, and will evaluate development opportunities that align with the overall strategic objectives of our business. We believe that holding our target assets for a long period of time will enable us to execute our business plan, generate stable cash-on-cash returns and drive long-term cash flow and net asset value growth. From time to time, at the discretion of our board of directors and advisor, we may elect to sell an investment before the end of its underwritten hold period if our advisor believes that will maximize value for us.

For more details regarding our liquidity strategy see “What is our Liquidity Strategy” below.

Do we have an allocation policy?

We rely on our advisor to identify suitable investments. Many investment opportunities that are suitable for us may also be suitable for Cottonwood Residential O.P., LP and Cottonwood Residential II, Inc. or other programs sponsored by such persons and affiliates of such persons. Our sponsor recently sponsored a $50,000,000 offering that qualified as a “Tier 2” offering pursuant to Regulation A promulgated under the Securities Act: Cottonwood Multifamily Opportunity Fund, Inc. (launched November 2017). As of the date of this prospectus this offering was fully subscribed and Cottonwood Multifamily Opportunity Fund, Inc. was investing the proceeds from its offering. It has investment objectives that overlap with ours. As of the date of this prospectus Cottonwood Multifamily Opportunity Fund, Inc. had made an initial investment in a development project for a multifamily apartment community. Our advisor and its affiliates will allocate potential investments between us and other entities that are sponsored by our advisor and its affiliates in a manner designed to meet each entity’s investment objectives by considering the investment portfolios of each entity, the cash available for investment by each entity and diversification objectives.

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Who is our advisor and property manager? What is the experience of our sponsor?

Through February 28, 2019, Cottonwood Communities Management, LLC, a limited liability company organized in the state of Delaware on February 8, 2018, acted as both our advisor and property manager. Effective March 1, 2019, as a result of the determination by Cottonwood Residential O.P., LP, to restructure the ownership of the entity that provides our advisory services, the advisory agreement was amended to remove references to property management services and assigned to a newly formed affiliate of Cottonwood Residential O.P., LP, CC Advisors III, LLC, such that our advisory services are currently provided by CC Advisors III, LLC. CC Advisors III, LLC is a recently organized limited liability company formed in the state of Delaware on January 30, 2019 and is a wholly owned subsidiary of Cottonwood Communities Advisors, LLC, a Delaware limited liability company organized on December 19, 2018. Through two different subsidiary entities Cottonwood Communities Advisors, LLC acts as the advisor to Cottonwood Multifamily REIT I and Cottonwood Multifamily REIT II, Inc., both programs that completed offerings qualified as a “Tier 2” offering pursuant to Regulation A promulgated under the Securities Act. Property management services will continue to be provided by Cottonwood Communities Management, LLC under separate property management agreements to be entered at the time we acquire a property.

CC Advisors III, LLC and Cottonwood Communities Management, LLC have little to no operating history and experience managing a public company or providing property management services, respectively. Both will rely on the expertise and experience of their affiliates to conduct our operations and manage our portfolio of multifamily apartment communities and multifamily real estate-related assets, all subject to the supervision of our board of directors. We have no paid employees. Our advisor, and the team of real estate professionals employed by our advisor and its affiliates, will make most of the decisions regarding the selection, financing and disposition of our assets.

CC Advisors III, LLC is a wholly owned subsidiary of Cottonwood Communities Advisors, LLC which is owned by Cottonwood Capital Management, Inc., a Delaware corporation formed on February 1, 2008, and two entities in which employees of Cottonwood Residential O.P., LP and its affiliates, including certain of our officers and directors have an ownership interest. Cottonwood Communities Management, LLC is a wholly owned subsidiary of Cottonwood Capital Management, Inc. Cottonwood Capital Management, Inc. has extensive experience in operating multifamily apartment communities and is controlled by its board of directors currently consisting of Daniel Shaeffer, Chad Christensen and Gregg Christensen. The sole shareholder of Cottonwood Capital Management, Inc. is Cottonwood Residential O.P., LP. which is the operating partnership of Cottonwood Residential II, Inc., our sponsor. Cottonwood Residential II, Inc. is a general partner of Cottonwood Residential O.P., LP and makes all decisions on behalf of Cottonwood Residential O.P., LP. Prior to Cottonwood Residential II, Inc.’s admission as a general partner of Cottonwood Residential O.P., LP in September 2018, Cottonwood Residential, Inc. was the sole general partner of Cottonwood Residential O.P., LP. Cottonwood Residential, Inc. remains as a nominal general partner of Cottonwood Residential O.P., LP and it is anticipated that Cottonwood Residential, Inc. will fully withdraw from Cottonwood Residential O.P., LP by the end of 2019.

As of December 31, 2018, Cottonwood Residential O.P., LP has ownership interests in 29 multifamily apartment communities and other related assets, 25 properties of which represent approximately 7,200 existing units, and 4 properties under development which represent approximately 1,000 additional units, all of which account for approximately $950.0 million in total gross asset value as of December 31, 2018. As of December 31, 2018, Cottonwood Residential O.P., LP provides property and asset management services to a platform of multifamily assets representing approximately 15,300 multifamily apartment units across 13 states with over $2.0 billion in value.

Cottonwood Residential II, Inc. is controlled by its board of directors currently consisting of Daniel Shaeffer, Chad Christensen, Gregg Christensen, Jonathan Gardner and Phillip White.

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What is the role of our board of directors?

We operate under the direction of our board of directors, the members of which are accountable to us and our shareholders as fiduciaries. Our board of directors is responsible for the management and control of our affairs, including oversight of all of our service providers. We currently have five members on our board of directors, three of whom are independent of our sponsor and its affiliates. Our charter requires that a majority of our directors be independent of our sponsor and creates a committee of our board consisting solely of all of our independent directors. This committee, which we call the conflicts committee, is responsible for reviewing the performance of our advisor and must approve other matters as set forth in our charter. The current members of our board of directors are Chad Christensen, Daniel Shaeffer, R. Brent Hardy, Gentry Jensen, and John Lunt.

What is our operating partnership?

We utilize an “umbrella partnership real estate investment trust” or “UPREIT” structure in which all our investments will be owned through our operating partnership. We are the sole general partner of the operating partnership. Cottonwood Communities Investor, LLC (a wholly owned subsidiary of Cottonwood Residential O.P., LP) is currently the sole limited partner of our operating partnership. Cottonwood Communities Investor, LLC has assigned its promotional interest in our operating partnership to Cottonwood Communities Advisors Promote, LLC, such that Cottonwood Communities Advisors Promote, LLC will be entitled to receive 15% of net income and distributions from the operating partnership even though it will not make any capital contributions to our operating partnership. This promotional interest is subordinated to the receipt by our common shareholders, together as a collective group, of distributions in an amount sufficient to provide our common shareholders with a 6% per year cumulative, noncompounded return on their investment plus a return of their invested capital. For each share purchased pursuant to this offering, we will acquire one common general partner unit of the operating partnership. We believe that using an UPREIT structure provides us with flexibility regarding our future acquisitions. Our operating partnership may accept contributions of property in exchange for limited partnership units in our operating partnership. If this occurs, we will amend the partnership agreement of our operating partnership.

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What is the structure of us, our operating partnership and our advisor?

The chart below shows the relationships among our company and various affiliates.

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What are the fees that we pay to our advisor and its affiliates?

CC Advisors III, LLC and its affiliates receive compensation and reimbursement for services relating to this offering and the investment and management of our assets. We also compensate our independent directors for their service to us. The most significant items of compensation are included in the table below. The compensation set forth below may only be increased if approved by a majority of the members of our conflicts committee. The increase of such compensation does not require approval by shareholders.

Form of Compensation and Recipient	Determination of Amount	Estimated Amount for Maximum Primary Offering
	Acquisition and Development Stage
Contingent Acquisition Fee – CC Advisors III, LLC (Our Advisor)	After our common shareholders have received, or are deemed to have received (with respect to a merger or a listing), together as a collective group, aggregate distributions sufficient to provide a return of their invested capital, plus a specified cumulative, noncompounded annual return on their invested capital (a “Required Return”), our advisor will receive from us contingent acquisition fees that are a percentage of the cost of investments acquired or originated by us, or the amount to be funded by us to acquire or originate loans, including acquisition and origination expenses and any debt attributable to such investments plus significant capital expenditures related to the development, construction or improvement of the investment as follows: 1% contingent acquisition fee if common shareholders receive a Required Return of 6%; and 2% additional contingent acquisition fee if common shareholders receive a Required Return of 13%. The contingent acquisition fee is payable upon satisfying each return threshold with respect to assets in the portfolio at the time the return threshold is satisfied and at the closing of acquisitions following satisfaction of the return threshold.	$15,000,000 (maximum offering, target leverage of 55% of the cost of our investments, 6% Required Return)/ $45,000,000 (maximum offering, target leverage of 55% of the cost of our investments, 13% Required Return)
Acquisition Expense Reimbursement – CC Advisors III, LLC (Our Advisor) Contingent Financing Fee – CC Advisors III, LLC (Our Advisor)	Subject to the limitations contained in our charter, reimbursement from us for all out-of-pocket expenses incurred in connection with the selection and acquisition or origination of investments, whether or not we ultimately acquire the property or other real estate-related investment. After our common shareholders have received, or are deemed to have received (with respect to a merger or a listing), together as a collective group, aggregate distributions sufficient to provide a return of their invested capital, plus a Required Return of 13%, our advisor will receive from us a contingent financing fee of 1% of the original principal amount of any financing obtained or assumed by us. The contingent financing fee is payable upon satisfying the return threshold with respect to any financing obtained or assumed by us prior to satisfaction of the return threshold and at the closing of new financing following satisfaction of the return threshold.	Actual amounts are dependent upon actual expenses incurred and, therefore, cannot be determined at this time. $8,250,000 (maximum offering, target leverage of 55% of the cost of our investments, 13% Required Return).

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Form of Compensation and Recipient	Determination of Amount	Estimated Amount for Maximum Primary Offering
	Operational Stage
Property Management Fees – Cottonwood Communities Management, LLC (Our Property Manager)	Cottonwood Communities Management, LLC receives from us a property management fee in an amount up to 3.5% of the annual gross revenues of our multifamily apartment communities that it manages. Cottonwood Communities Management, LLC may subcontract the performance of its property management duties to third parties and Cottonwood Communities Management, LLC will pay a portion of its property management fee to the third parties with whom it subcontracts for these services.	Actual amounts depend upon the gross revenue of the properties and therefore cannot be determined at this time.
Asset Management Fee – CC Advisors III, LLC (Our Advisor)	CC Advisors III, LLC receives from us an annual asset management fee, paid monthly, in an amount equal to 1.25% of our gross assets as of the last day of the prior month. See “Management Compensation” for a discussion of how we calculate our gross assets for purposes of calculating the asset management fee.	Actual amounts depend upon the gross offering proceeds we raise in this offering and therefore cannot be determined at this time.
Other Company Operating Expenses – CC Advisors III, LLC (Our Advisor or its affiliates)	We reimburse our advisor or its affiliates for all actual expenses paid or incurred by our advisor or its affiliates in connection with the services provided to us, including our allocable share of the advisor’s or its affiliates’ overhead, such as rent, personnel costs, utilities, cybersecurity and IT costs; provided, however, that we do not reimburse our advisor or its affiliates for salaries, wages and related benefits of personnel who perform investment advisory services for us or serve as our executive officers. In addition, subject to the approval of our board of directors we may reimburse our advisor or its affiliates for costs and fees associated with providing services to us that we would otherwise engage a third party to provide.	Actual amounts are dependent upon the results of our operations; we cannot determine these amounts at the present time.
Promotional Interest from Operating Partnership – Cottonwood Communities Advisors Promote, LLC	Cottonwood Communities Advisors Promote, LLC will receive from the Operating Partnership a promotional interest equal to 15% of net income and cash distributions, but only after our common shareholders receive, together as a collective group, distributions sufficient to provide a return of their invested capital plus a 6% cumulative, non-compounded annual return on their invested capital. Cottonwood Communities Investor, LLC, the sole limited partner of our operating partnership assigned its promotional interest to Cottonwood Communities Advisors Promote, LLC. Neither Cottonwood Communities Investor, LLC nor Cottonwood Communities Advisors Promote, LLC were required to make any capital contributions to our operating partnership in order to obtain the promotional interest. Cottonwood Communities Advisors Promote, LLC will be entitled to a separate one-time payment payable upon (1) the listing of our common stock on a national securities exchange or (2) the occurrence of certain events that result in the termination or non-renewal of our advisory agreement, in each case for an amount that Cottonwood Communities Advisors Promote, LLC would have been entitled to receive, as described above, as if our Operating Partnership had disposed of all of its assets at the market value of our shares of common stock as of the date of the event triggering the payment. If the event triggering the payment is a listing of our shares on a national securities exchange, the market value will be calculated based on the market value of the shares issued and outstanding at listing over a period of 30 trading days selected by our advisor beginning after the first day of the 6th month, but not later than the last day of the 18th month, after the shares are first listed on a national securities exchange. If the triggering event is the termination or non-renewal of our advisory agreement the market value will be calculated based on an appraisal or valuation of our assets by an independent third party.	Actual amounts depend on the results of the performance of the multifamily apartment communities and therefore cannot be determined at this time.

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Form of Compensation and Recipient	Determination of Amount	Estimated Amount for Maximum Primary Offering
	In addition, if this separate one-time payment is owed following the termination or non-renewal of our advisory agreement for reasons unrelated to a liquidity event for our shareholders, the payment will be in the form of an interest-bearing promissory note that is payable only after our shareholders have actually received distributions in the amount required before receipt of the promotional interest. Provided, however, if the promissory note has not been repaid prior to a liquidity event for our shareholders, the promissory note shall be paid in full on the date of or immediately prior to the liquidity event.
Independent Director Compensation	We pay each of our independent directors an annual retainer of $10,000. We also pay our independent directors for attending meetings as follows: (i) $500 for each board meeting attended and (ii) $500 for each committee meeting attended (if held at a different time or place than a board meeting). All directors receive reimbursement of reasonable out of pocket expenses incurred in connection with attendance at meetings of the board of directors.	Actual amounts are dependent upon the total number of board and committee meetings that each independent director attends and therefore cannot be determined at this time.

What is a REIT?

We intend to qualify as a REIT and to be taxed as a REIT under the Internal Revenue Code of 1986, as amended, beginning with the taxable year ending December 31, 2019. In general, a REIT is an entity that:

• combines the capital of many investors to acquire or provide financing for real estate investments;

• allows individual investors to invest in a professionally managed, large-scale diversified real estate portfolio though the purchase of interests, typically shares, in the REIT;

• is required to pay to investors at least 90% of its annual REIT taxable income (computed without regard to the dividends paid deduction and excluding net capital gain); and

• avoids the “double taxation” treatment of income that normally results from investments in a corporation because a REIT is not generally subject to federal corporate income taxes on that portion of its income distributed to its shareholders, provided certain income tax requirements are satisfied.

However, under the Internal Revenue Code of 1986, as amended, REITs are subject to numerous organizational and operating requirements. If we fail to qualify for taxation as a REIT in any year after electing REIT status, our income will be taxed at regular corporate rates, and we may be precluded from qualifying for treatment as a REIT for the four-year period following our failure to qualify. Even if we qualify as a REIT for federal income tax purposes, we may still be subject to state and local taxes on our income and property and to federal and excise taxes on our undistributed income.

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Certain domestic shareholders that are individuals, trusts or estates are taxed on corporate distributions at a maximum rate of 20% (the same as long-term capital gains). With limited exceptions, however, distributions from us or from other entities that are taxed as REITs are generally not eligible for this rate and will continue to be taxed at rates applicable to ordinary income, which will be as high as 37.0%. See “—Taxation of Shareholders—Taxation of Taxable Domestic Shareholders—Distributions.” However, for taxable years prior to 2026, individual shareholders are generally allowed to deduct 20% of the aggregate amount of ordinary dividends distributed by us, subject to certain limitations, which would reduce the maximum marginal effective tax rate for individuals on the receipt of such ordinary dividends to 29.6%. The Internal Revenue Service has issued proposed regulations that would affect an individual shareholder’s ability to claim this deduction if our stock has not been held for at least 45 days prior to the payment of the dividend. Individual shareholders are urged to consult their tax advisors as to their ability to claim this deduction.

The timing and amount of distributions we pay will be determined by our board of directors in its discretion and may vary from time to time. Generally, our policy will be to make distributions from cash flow from operations. However, we expect to have little, if any, cash flow from operations available for distribution until we make substantial investments. Further, because we may receive income from interest or rents at various times during our fiscal year and because we may need cash flow from operations during a particular period to fund capital expenditures and other expenses, we expect that at least during the early stages of our development and from time to time during our operational stage, we will declare distributions in anticipation of cash flow that we expect to receive during a later period, and we expect to pay these distributions in advance of our actual receipt of these funds. In addition, to the extent our investments are in development or redevelopment projects or in properties that have significant capital requirements, our ability to make distributions may be negatively impacted, especially during our early periods of operation. In these instances, our board of directors has the authority under our organizational documents, to the extent permitted by Maryland law, to fund distributions from sources such as borrowings, advances, offering proceeds or the deferral of fees and expense reimbursements in its sole discretion. Such distributions will likely exceed our earnings or cash flow from operations for the corresponding period. We have not established a limit on the amount of proceeds we may use from this offering to fund distributions. If we make distributions from sources other than cash flow from operations, we will have fewer funds available for investments and your overall return on your investment in us may be reduced and subsequent investors will experience dilution. In addition, to the extent distributions exceed cash flow from operating activities, a shareholder’s basis in our stock will be reduced and, to the extent distributions exceed a shareholder’s basis, the shareholder may recognize capital gain.

For the six months ended June 30, 2019, we paid aggregate distributions of $399,057, including $311,471 of distributions paid in cash and $87,586 of distributions reinvested through our distribution reinvestment plan. Our net loss for the six months ended June 30, 2019 was $934,223. Cash flows provided by operating activities for the six months ended June 30, 2019 was $364,861. We funded our total distributions paid, which includes net cash distributions and distributions reinvested by shareholders, with offering proceeds. Generally, for purposes of determining the source of our distributions paid, we assume first that we use cash flow from operating activities from the relevant or prior periods to fund distributions payments. However, due to the timing of the receipt of cash flow from operations in the second quarter of 2019, the cash was not available to fund distributions until July. Additional information regarding our distributions is included in a supplement to this prospectus.

What are the terms of this offering?

We are offering up to $675,000,000 of shares of our Class A and Class T common stock in our primary offering for $10.00 per share without any upfront costs or expenses charged to the investor and an aggregate of $75,000,000 of shares of our Class A and Class T common stock pursuant to our distribution reinvestment plan at a purchase price initially equal to the purchase price of the shares in the primary offering or $10.00 per share. We are offering to sell any combination of our Class A and Class T common stock, with a dollar value up to the maximum offering amount. The share classes have different selling commission structures. Any offering-related expenses are paid by our advisor without reimbursement by us.

Our shares are not listed for trading on any securities exchange or over-the-counter market at the time you purchase the shares. It is unlikely that any public market for the shares will develop. You should expect to hold your shares for an extended period of time.

How does a “best efforts” offering work?

When shares are offered on a “best efforts” basis, the dealer manager is required to use only its best efforts to sell the shares and it has no firm commitment or obligation to purchase any of the shares. Therefore, we may sell substantially less than the all of the shares that we are offering.

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How long will this offering last?

The termination date of this offering will be August 13, 2020, unless extended by our board of directors for an additional year or as otherwise permitted by applicable securities laws. If we decide to continue our offering beyond August 13, 2020, we will provide that information in a prospectus supplement. The offering will terminate earlier if we raise the full primary offering amount of $675,000,000 before such time. We may continue to offer shares under our distribution reinvestment plan beyond the two years from the date of this prospectus until we have sold $75,000,000 of shares through the reinvestment of distributions. In many states, we will need to renew the registration statement or file a new registration statement to continue the offering beyond one year from the date of this prospectus. We may terminate this offering at any time, and we will provide that information in a prospectus supplement.

Who can buy shares?

An investment in our shares is only suitable for persons who have adequate financial means and who will not need immediate liquidity from their investment. Residents of many states can buy shares in this offering provided that they have either (1) a net worth of at least $70,000 and an annual gross income of at least $70,000 or (2) a net worth of at least $250,000. For the purpose of determining suitability, net worth does not include an investor’s home, home furnishings or personal automobiles. The minimum suitability standards are more stringent for investors in certain other states. See “Suitability Standards.”

Why are we offering two classes of our common stock and what are the differences among the classes?

The two classes of common stock offered in this offering are meant to provide broker dealers participating in this offering with more flexibility to facilitate investment in us as the two classes provide different compensation structures to participating broker dealers. Because any offering-related expenses, including upfront and deferred selling commissions, which are the only differences between the two classes, are being paid by our advisor without reimbursement by us, the two classes of common stock are effectively the same to an investor in us.

The amount of upfront selling commissions differs among Class A and Class T shares and there is a deferred selling commission with respect to Class T shares sold in the primary offering; however, we expect that the total compensation payable to broker dealers in this offering will be the same whether an investor purchases a Class A or a Class T share.

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How should you determine which class of common stock to invest in?

Because the only difference between the two classes of common stock relates to the underwriting compensation paid to the broker dealer, which compensation our advisor has agreed to pay on our behalf without any reimbursement by us, we believe the decision as to which class of common stock to invest in will be driven by your financial advisor. Some broker dealers have adopted policies that require their financial advisors to receive some portion of their compensation over time, in which case Class T would be appropriate. In addition, some financial advisors may only sell one class of our shares.

The amount of upfront selling commissions differs among Class A shares and Class T shares, and there is a deferred selling commission with respect to Class T shares sold in the primary offering; however, we expect that the total compensation paid in connection with the sale of our common stock will be the same. The following table summarizes the fees related to each class of our common stock sold in our primary offering and indicates the maximum fees payable on a hypothetical investment of $10,000 in each class of shares. Our advisor has agreed to pay all upfront and deferred selling commissions, dealer manager fees, and organization and offering expenses on our behalf without reimbursement by us.

	Class A Shares			1,000 Class A Shares		Class T Shares			1,000 Class T Shares
Price Per Share/Amount Invested	$	10.00		$	10,000	$	10.00		$	10,000
Upfront Selling Commissions(1)		6.0	%	$	600		3.0	%	$	300
Dealer Manager Fees		3.0	%	$	300		3.0	%	$	300
Deferred Selling Commission(2)		None		$	0		1.0	%(2)	$	300	(2)

⁽¹⁾  The selling commission associated with shares of Class A common stock may be reduced for certain categories of purchasers. See “Plan of Distribution.”

⁽²⁾  Except as described in the “Plan of Distribution” section of this prospectus, an annual deferred selling commission of 1.0% of the estimated value per share for each Class T share sold in the primary offering will be paid to our dealer manager and will accrue daily and be paid monthly in arrears. Payment of the deferred selling commissions with respect to individual Class T shares will cease when they are no longer outstanding, including as a result of conversion to Class A shares and redemption or repurchase. Each Class T share held in a shareholder’s account shall automatically and without any action on the part of the holder thereof convert into a Class A share, on the earliest to occur of the following: (i) a listing of the Class A shares on a national securities exchange; (ii) a merger or consolidation of our company with or into another entity, or the sale or other disposition of all or substantially all of our assets; and (iii) the last calendar day of the month in which we and our dealer manager, in conjunction with our transfer agent, determine that the deferred selling commission paid with respect to the Class T shares held by such shareholder within such account equals or exceeds three percent of the aggregate gross purchase price of the Class T shares held by such shareholder within such account and purchased in a primary offering. In addition, after termination of a primary offering registered under the Securities Act, payment of the deferred selling commission with respect to each Class T share sold in that primary offering will cease, on the date when we, with the assistance of our dealer manager, determine that all underwriting compensation paid or incurred with respect to the primary offering covered by that registration statement from all sources, determined pursuant to the rules and guidance of FINRA, would be in excess of 10% of the aggregate purchase price of all shares sold for our account through that primary offering. Further, each Class T share sold in that primary offering, each Class T share sold under a distribution reinvestment plan pursuant to the same registration statement that was used for that primary offering, and each Class T share received as a stock dividend with respect to such shares sold in such primary offering or distribution reinvestment plan shall automatically and without any action on the part of the holder thereof convert into a Class A share at the last calendar day of the month in which such determination is made.

The deferred selling commission is only paid on Class T shares purchased in the primary offering; no deferred selling commission is paid on Class T shares purchased through the distribution reinvestment plan or issued pursuant to a stock dividend. The deferred selling commission is paid by our advisor without reimbursement by us and will have no impact on our Class T shareholders.

How do I subscribe for shares?

If you choose to purchase shares in this offering, you will need to complete and sign a subscription agreement (in the form attached to this prospectus as Appendix A) for a specific number and class of shares and pay for the shares at the time of your subscription.

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Are there risks associated with an investment in our shares?

An investment in shares of our common stock involves significant risks, including those described below.

• We have little to no operating history. As of the date of this prospectus we own one multifamily community, a B note secured by a mortgage on a multifamily development project and a preferred equity investment in a multifamily development project. There is no assurance that we will be able to successfully achieve our investment objectives.

• Our charter does not require our directors to provide our shareholders with a liquidity event by a specified date or at all. Our shares cannot be readily sold and it will be difficult for you to sell your shares. If you are able to sell your shares, you will likely sell them at a substantial discount.

• There are restrictions and limitations on your ability to have all or any portion of your shares of our common stock repurchased under our share repurchase program and, if you are able to have your shares repurchased, it may be at a price that is less than the price you paid for the shares or the value of the shares at such time.

• The amount of distributions we may make is uncertain. Our distributions may be paid from sources such as borrowings, offering proceeds, advances or the deferral of fees and expense reimbursements (which may constitute a return of capital). We have not established a limit on the amount of proceeds from this offering that we may use to fund distributions. Distributions from sources other than our cash flow from operations would reduce the funds available to us for investments in multifamily apartment communities and multifamily real estate-related assets, which could reduce your overall return. During the early stages of our operations, it is likely that we will use sources of funds which may constitute a return of capital to fund distributions. As of June 30, 2019, we have funded our distributions with offering proceeds.

• Our officers and certain of our directors are also officers and directors of Cottonwood Residential II, Inc. and its affiliates. As a result, our officers and affiliated directors are subject to conflicts of interest.

• We have not established the offering price on an independent basis and it bears no relationship to the value of our assets.

• Except for investments described in a supplement to this prospectus, you will not have the opportunity to evaluate our investments prior to purchasing shares of our common stock.

• Our ability to raise money and achieve our investment objectives depends on the ability of the dealer manager to successfully market our offering. If we raise substantially less than the maximum offering amount, we may not be able to invest in a diverse portfolio of assets and the value of your investment may vary more widely with the performance of certain investments.

• We pay certain fees and expenses to our advisor and its affiliates. These fees were not negotiated at arm’s length and therefore may be higher than fees payable to unaffiliated third parties.

• Development projects in which we invest will be subject to potential development and construction delays which will result in increased costs and risks and may hinder our operating results and ability to make distributions.

• We may incur significant debt in certain circumstances. Our use of leverage increases the risk of your investment. Loans we obtain may be collateralized by some or all of our investments, which will put those investments at risk of forfeiture if we are unable to pay our debts. Principal and interest payments on these loans reduce the amount of money that would otherwise be available for other purposes.

• Volatility in the debt markets could affect our ability to obtain financing for investments or other activities related to real estate assets and the diversification or value of our portfolio, potentially reducing cash available for distribution to our shareholders or our ability to make investments. In addition, if any of the loans we obtain have variable interest rates, volatility in the debt markets could negatively impact such loans.

• If we fail to qualify as a REIT, it would adversely affect our operations and our ability to make distributions to our shareholders because we will be subject to United States federal income tax at regular corporate rates with no ability to deduct distributions made to our shareholders.

Are there conflicts of interest for our board of directors and officers?

We may experience conflicts of interest with our advisor, Cottonwood Residential O.P., LP and Cottonwood Residential II, Inc. or their affiliates in connection with this offering and the management of our business. The conflicts of interest that may arise include the following:

• Two of our directors are also directors of Cottonwood Residential II, Inc. Such overlapping directors face conflicts of interest between their obligations to Cottonwood Residential II, Inc. and their obligations to us;

• Two of our directors and officers are also directors and officers of Cottonwood Residential II, Inc. and its affiliates and must allocate their time between advising us and managing Cottonwood Residential II, Inc.’s businesses and the other real estate projects and business activities in which they may be involved;

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• The compensation payable by us to our advisor and its affiliates may not be on terms that would result from arm’s-length negotiations between unaffiliated parties, and certain fees are payable regardless of the performance of our investments;

• The property management fees, construction management fees and asset management fees payable to our property manager and advisor will generally be payable regardless of the quality of services provided to us; and

• If we terminate our advisory agreement our advisor may be motivated to terminate its participation in the Three-Party Agreement that obligates our advisor to pay upfront and deferred selling commissions, dealer manager fees, and organization and offering expenses on our behalf without reimbursement by us. If our advisor ceases to pay our offering expenses, we may be forced to terminate this offering.

Do we have a share repurchase program?

Our share repurchase program may provide an opportunity for our shareholders to have their shares of our common stock repurchased by us, subject to certain restrictions and limitations. Unless being repurchased in connection with the death or “complete disability” (as defined under “Description of Shares – Share Repurchase Program”) of a shareholder (together, “Exceptional Repurchases”), generally no shares can be repurchased under our share repurchase program until after the first anniversary of the date of purchase of such shares from us by the applicable investor.

Generally, the purchase price for shares repurchased under our share repurchase program are as follows:

Share Purchase Anniversary	Repurchase Price
Less than 1 year	No Repurchase Allowed
1 year – 2 years	85% of Estimated Value Per Share(1)
3 years – 4 years	90% of Estimated Value Per Share(1)
5 years and thereafter	95% of Estimated Value Per Share(1)
A shareholder’s death or complete disability, less than 2 years	95% of Estimated Value Per Share(1)
A shareholder’s death or complete disability, 2 years or more	100% of Estimated Value Per Share(1)

(1) For the purposes of our share repurchase program, the “estimated value per share” will initially be equal to the purchase price per share at which the original purchaser or purchasers of the shares bought its shares from us, and the purchase price per share will be adjusted to reflect any stock dividends, combinations, splits, recapitalizations or any similar transaction with respect to the shares outstanding.

We plan to establish an estimated net asset value (“NAV”) per share of our common stock based on valuations of our assets and liabilities no later than May 17, 2021, and annually thereafter. Upon our establishment of an estimated NAV per share, the estimated NAV per share will be the estimated value per share pursuant to our share repurchase program.

For purposes of determining the time period a redeeming shareholder has held each share, the time period begins as of the date such shareholder acquired the shares in question (the “acquisition date”); provided, that the shares purchased by the redeeming shareholder pursuant to our distribution reinvestment plan will be deemed to have been acquired on the same date as the initial share to which the distribution reinvestment plan shares relate.

We are not obligated to repurchase shares of our common stock under our share repurchase program. We presently intend to limit the number of shares to be repurchased in any calendar year to 5% of the weighted-average number of shares of our common stock outstanding during the prior calendar year. In addition, during any calendar year, we may redeem only the number of shares that we could purchase with the amount of net proceeds from the sale of shares under our distribution reinvestment plan during the prior calendar year. There is no fee in connection with a repurchase of shares of our common stock.

Our board of directors may, in its sole discretion, amend, suspend, or terminate our share repurchase program for any reason upon 15 days’ notice to our shareholders. Therefore, shareholders may not have the opportunity to make a repurchase request prior to any potential termination or suspension of our share repurchase program.

May I reinvest my distributions in additional shares of Cottonwood Communities, Inc.?

Yes. We have adopted a distribution reinvestment plan. You may participate in our distribution reinvestment plan by checking the appropriate box on the subscription agreement or by filling out an enrollment form, which we will provide to you at your request. The purchase price of shares purchased under the distribution reinvestment plan will initially be $10.00 per

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share. Once we establish an estimated net asset value (“NAV”) per share, shares issued pursuant to our distribution reinvestment plan will be priced at the NAV per share of our stock, as determined by our board. No upfront or deferred selling commissions or dealer manager fees are payable on shares sold under our distribution reinvestment plan. We may amend or terminate the distribution reinvestment plan for any reason at any time upon 10 days’ written notice to the participants. For more information regarding our distribution reinvestment plan, see “Description of Shares – Distribution Reinvestment Plan.”

Will we register as an investment company?

We intend to conduct our operations so that neither we nor any of our subsidiaries will be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act.

Neither we nor any of our subsidiaries intend to register as investment companies under the Investment Company Act. If we or our subsidiaries were obligated to register as investment companies, then we would have to comply with a variety of substantive requirements under the Investment Company Act that impose, among other things:

• limitations on capital structure;

• restrictions on specified investments;

• prohibitions on transactions with affiliates; and

• compliance with reporting, record keeping, voting, proxy disclosure and other rules and regulations that would significantly increase our operating expenses.

Under the relevant provisions of Section 3(a)(1) of the Investment Company Act, an investment company is any issuer that:

• pursuant to Section 3(a)(1)(A), is or holds itself out as being engaged primarily, or proposes to engage primarily, in the business of investing, reinvesting or trading in securities (the “primarily engaged test”); or

• pursuant to Section 3(a)(1)(C), is engaged or proposes to engage in the business of investing, reinvesting, owning, holding or trading in securities and owns or proposes to acquire “investment securities” having a value exceeding 40% of the value of such issuer’s total assets (exclusive of United States government securities and cash items) on an unconsolidated basis (the “40% test”). “Investment securities” excludes United States government securities and securities of majority-owned subsidiaries that are not themselves investment companies and are not relying on the exception from the definition of investment company under Section 3(c)(1) or Section 3(c)(7) (relating to private investment companies).

Neither we nor our Operating Partnership should be required to register as an investment company under either of the tests above. With respect to the 40% test, most of the entities through which we and our Operating Partnership will own our assets will be majority-owned subsidiaries that will not themselves be investment companies and will not be relying on the exceptions from the definition of investment company under Section 3(c)(1) or Section 3(c)(7) (relating to private investment companies).

With respect to the primarily engaged test, we and our Operating Partnership will be holding companies and do not intend to invest or trade in securities ourselves. Rather, through the majority-owned subsidiaries of our Operating Partnership, we and our Operating Partnership will be primarily engaged in the non-investment company businesses of these subsidiaries, namely the business of purchasing or otherwise acquiring real estate and real estate-related assets.

If any of the subsidiaries of our Operating Partnership fail to meet the 40% test, then we believe they will often be able to rely on Section 3(c)(5)(C) of the Investment Company Act for an exception from the definition of an investment company. As reflected in no-action letters, the SEC staff’s position on Section 3(c)(5)(C) generally requires that an issuer maintain at least 55% of its assets in “mortgages and other liens on and interests in real estate” or qualifying assets; at least 80% of its assets in qualifying assets plus real estate-related assets; and no more than 20% of the value of its assets in other than qualifying assets and real estate-related assets. To constitute a qualifying asset under this 55% requirement, a real estate interest must meet various criteria based on no-action letters. We expect that any of the subsidiaries of our Operating Partnership relying on Section 3(c)(5)(C) will invest at least 55% of its assets in qualifying assets, with substantially all of its remaining assets in other types of real estate-related assets. If any subsidiary relies on Section 3(c)(5)(C), then we expect to rely on guidance published by the SEC staff or on our analyses of guidance published with respect to types of assets to determine which assets are qualifying real estate assets and real estate-related assets.

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To maintain compliance with the Investment Company Act, our subsidiaries may be unable to sell assets we would otherwise want them to sell and may need to sell assets we would otherwise wish them to retain. In addition, our subsidiaries may have to acquire additional assets that they might not otherwise have acquired or may have to forego opportunities to make investments that we would otherwise want them to make and would be important to our investment strategy. Moreover, the SEC or its staff may issue interpretations with respect to various types of assets that are contrary to our views and current SEC staff interpretations are subject to change, which increases the risk of non-compliance and the risk that we may be forced to make adverse changes to our portfolio. In this regard, we note that in 2011 the SEC issued a concept release indicating that the SEC and its staff were reviewing interpretive issues relating to Section 3(c)(5)(C) and soliciting views on the application of Section 3(c)(5)(C) to companies engaged in the business of acquiring mortgages and mortgage related instruments. If we were required to register as an investment company but failed to do so, we would be prohibited from engaging in our business and criminal and civil actions could be brought against us. In addition, our contracts would be unenforceable unless a court required enforcement and a court could appoint a receiver to take control of us and liquidate our business. For more information related to compliance with the Investment Company Act, see the “Investment Objectives and Criteria—Investment Limitations Under the Investment Company Act of 1940” section of this prospectus.

What is the impact of being an “emerging growth company”?

We do not believe that being an “emerging growth company,” as defined by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), will have a significant impact on our business or this offering. We have elected to opt out of the extended transition period for complying with new or revised accounting standards pursuant to Section 102(b) of the JOBS Act. This election is irrevocable. Also, because we are not a large accelerated filer or an accelerated filer under Section 12b-2 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and we will not be for so long as our shares of common stock are not traded on a securities exchange, we are not subject to the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act of 2002. In addition, so long as we are externally managed by our advisor, we do not expect to be required to seek shareholder approval of executive compensation and “golden parachute” compensation arrangements pursuant to Section 14A(a) and (b) of the Exchange Act. We will remain an emerging growth company for up to five years, although we will lose that status sooner if our revenues exceed $1 billion, if we issue more than $1 billion in non-convertible debt in a three year period or if the market value of our common stock that is held by non-affiliates exceeds $700 million as of any June 30.

What is our liquidity strategy?

In the future, our board of directors will consider alternatives for providing liquidity to our shareholders, each of which is referred to as a “liquidity event,” including the sale of our assets, a sale or merger of our company or a listing of our shares on a national securities exchange. Our charter requires that if we do not list our shares of common stock on a national securities exchange by August 13, 2028, we must either:

• seek shareholder approval of the liquidation of the company; or

• postpone the decision of whether to liquidate the company if a majority of the board of directors determines that liquidation is not then in the best interests of our shareholders.

We are not, however, required to provide our shareholders a liquidity event by a specified date or at all. If a majority of the board of directors does determine that liquidation is not then in the best interests of our shareholders, our charter requires that the board of directors revisit the issue of liquidation at least annually. Further postponement of listing or shareholder action regarding liquidation would only be permitted if a majority of the board of directors again determined that liquidation would not be in the best interest of our shareholders. If we sought and failed to obtain shareholder approval of our liquidation, our charter would not require us to list or liquidate and would not require the board of directors to revisit the issue of liquidation, and we could continue to operate as before. If we sought and obtained shareholder approval of our liquidation, we would begin an orderly sale of our assets. The precise timing of such sales would take into account the prevailing real estate and finance markets, the economic conditions in the submarkets where our properties are located and the debt markets generally as well as the federal income tax consequences to our shareholders. In making the decision regarding which type of liquidity event to pursue, our board of directors will try to determine which available alternative method would result in the greatest value for our shareholders.

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Who can help answer my questions about the offering?

If you have more questions about the offering, or if you would like additional copies of this prospectus, you should contact your registered representative or contact:

Cottonwood Communities, Inc.

6340 South 3000 East, Suite 500

Salt Lake City, Utah 84121

Telephone: (801) 278-0070

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RISK FACTORS

Investing in our common stock involves a high degree of risk and uncertainties. You should carefully consider the following risk factors and all other information contained in this prospectus before purchasing our common stock. If any of the following risks were to occur, our business, financial condition or results of operations could be materially and adversely affected. In these circumstances, the value of our common stock may decline, and you could lose some or all of your investment. The risks and uncertainties described below are not the only ones we face but do represent those risks and uncertainties that we believe are material to us. Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also harm our business.

Risks Related to an Investment in our Common Stock

Because no public trading market for your shares currently exists, it will be difficult for you to sell your shares and, if you are able to sell your shares, you will likely sell them at a substantial discount to the offering price.

There is currently no public market for our shares and we currently have no plans to list our shares on a securities exchange. Our charter does not require our directors to seek shareholder approval to liquidate our assets and dissolve by a specified date or at all, nor does our charter require our directors to list our shares for trading on a national securities exchange by a specified date or at all. Any subsequent sale must comply with applicable state and federal securities laws. Our charter prohibits the ownership of more than 9.8% of our stock, unless exempted by our board of directors, which may inhibit large investors from desiring to purchase your shares. Moreover, our share repurchase program includes numerous restrictions that limit your ability to sell your shares to us, and our board of directors may amend, suspend, or terminate our share repurchase program upon 15 days’ notice to our shareholders. We describe the restrictions of our share repurchase program in detail under “Description of Shares—Share Repurchase Program.” Therefore, it will be difficult for you to sell your shares promptly or at all. If you are able to sell your shares, you will likely have to sell them at a substantial discount to their offering price. It is also likely that your shares will not be accepted as the primary collateral for a loan. You should purchase our shares only as a long-term investment because of the illiquid nature of the shares.

We will face significant competition for multifamily apartment communities and multifamily real estate-related assets, which may limit our ability to acquire suitable investments and achieve our investment objectives or make distributions.

We will be competing to acquire multifamily apartment communities and multifamily real estate-related assets with other REITs, real estate limited partnerships, pension funds and their advisors, bank and insurance company investment accounts, and other entities. Many of our competitors have greater financial resources, and a greater ability to borrow funds to acquire properties, than we do. We cannot be sure that the board of directors and our advisor will be successful in obtaining suitable investments on financially attractive terms or that, if investments are made, our objectives will be achieved.

If we are unable to find suitable investments or if we raise substantial offering proceeds in a short period of time and are unable to invest all of the offering proceeds promptly, we may not be able to achieve our investment objectives or make distributions.

The more money we raise in this offering, the greater our challenge will be to invest all of the offering proceeds on attractive terms. If we are unable to promptly find suitable multifamily apartment communities or multifamily real estate-related assets, we will hold the proceeds from this offering in an interest-bearing account or invest the proceeds in short-term investments and may, ultimately, liquidate. We could also suffer from delays in locating suitable investments. In addition, our sponsor is sponsoring Cottonwood Multifamily Opportunity Fund, Inc. which has investment objectives that overlap with ours. Our reliance on our advisor and sponsor and the real estate professionals that such persons retain to identify suitable investments for us at times when such persons are simultaneously seeking to identify suitable investments for other affiliated programs could also delay the investment of the proceeds of this offering. Delays we encounter in the selection and acquisition of income-producing multifamily apartment communities or the acquisition or origination of multifamily real estate-related assets would likely limit our ability to make distributions to you and reduce your overall returns.

Furthermore, where we acquire properties prior to the start of construction or during the early stages of construction, it will typically take several months to complete construction and rent available space. Therefore, you could suffer delays in the receipt of distributions attributable to those particular properties.

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Our success is dependent on general market and economic conditions.

The real estate industry generally and the success of our investment activities in particular will both be affected by global and national economic and market conditions generally and by the local economic conditions where our properties are located. These factors may affect the level and volatility of real estate prices, which could impair our profitability or result in losses. In addition, general fluctuations in the market prices of securities and interest rates may affect our investment opportunities and the value of our investments. Our sponsor’s financial condition may be adversely affected by a significant economic downturn and it may be subject to legal, regulatory, reputational and other unforeseen risks that could have a material adverse effect on its businesses and operations (including our advisor).

A recession, slowdown and/or sustained downturn in the U.S. real estate market, and to a lesser extent, the global economy (or any particular segment thereof) would have a pronounced impact on us, the value of our assets and our profitability, impede the ability of our assets to perform under or refinance their existing obligations, and impair our ability to effectively deploy our capital or realize upon investments on favorable terms. We could also be affected by any overall weakening of, or disruptions in, the financial markets. Any of the foregoing events could result in substantial losses to our business, which losses will likely be exacerbated by the presence of leverage in our investments capital structures.

For example, during the recent financial crisis, the availability of debt financing secured by commercial real estate was significantly restricted as a result of a prolonged tightening of lending standards. Due to the uncertainties created in the credit market, real estate investors were unable to obtain debt financing on attractive terms, which adversely affected investment returns on acquisitions and their ability to even make acquisitions or tenant improvements to existing holdings. Any future financial market disruptions may force us to use a greater proportion of our offering proceeds to finance our acquisitions and fund tenant improvements, reducing the number of acquisitions we would otherwise make.

Because our shareholders will not have the opportunity to evaluate any investments we may make with the proceeds from this offering before we make them, we are considered to be primarily a blind pool. We may make investments with which our shareholders do not agree.

We are considered to be a “blind pool” and, except as described in a supplement to this prospectus, we are not able to provide you with any information to assist you in evaluating the merits of any specific assets that we may acquire. We will seek to invest substantially all of the proceeds from this offering in the acquisition of or investment in interests in multifamily apartment communities and multifamily real estate-related assets. Our advisor and board of directors have broad discretion when identifying, evaluating and making such investments. You will have no opportunity to evaluate the transaction terms or other financial or operational data concerning specific investments before we invest in them. Furthermore, our advisor and board of directors have broad discretion in implementing policies regarding tenant or mortgagor creditworthiness and you will likewise have no opportunity to evaluate potential tenants, managers or borrowers. As a result, you must rely on our advisor and board of directors to identify and evaluate our investment opportunities, and they may not be able to achieve our business objectives, may make unwise decisions or may make investments with which you do not agree.

If we raise substantially less than the maximum amount in this offering, adverse investment performance, increased expenses, and our fixed operating expenses will have a more significant adverse impact on our ability to achieve our business objectives and to make distributions than if we raise the maximum amount in this offering.

Our common stock is being offered on a “best-efforts” basis and no individual, firm or corporation has agreed to purchase any of our common shares in this offering. If we raise substantially less than the maximum amount of funds in this offering, we may make fewer investments than we would if we are able to raise the maximum amount of funds in this offering. In that case, the likelihood that any single asset’s performance would adversely affect our profitability will increase. In addition, we will incur certain fixed operating expenses, such as costs incurred to secure insurance for our officers and directors, regardless of our size. Our failure to raise the maximum amount in this offering would increase our fixed operating expenses as a percentage of gross income, reducing our net income and cash flow and limiting our ability to make distributions to you.

If we fail to diversify our investment portfolio, downturns relating to certain geographic regions, types of assets, industries or business sectors may have a more significant adverse impact on our assets and our ability to make distributions than if we had a diversified investment portfolio.

While we intend to diversify our portfolio of investments in the manner described in this prospectus, we are not required to observe specific diversification criteria. Therefore, our investments in multifamily apartment communities and multifamily real estate-related assets may be concentrated in assets that are subject to higher risk of foreclosure or concentrated in a limited number of geographic locations. To the extent that our portfolio is concentrated in limited geographic regions, downturns relating generally to such region may result in defaults on a number of our investments within a short time period, which may reduce our net income and the value of our common stock and accordingly limit our ability to make distributions to you.

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We have little to no operating history and we may not be able to operate our business successfully or generate sufficient revenue to make or sustain distributions to our shareholders.

We are a recently formed company and we have little to no operating history. We were incorporated in the State of Maryland on July 27, 2016. As of the date of this prospectus we own one multifamily community, a B note secured by a mortgage on a multifamily development project and a preferred equity investment in a multifamily development project. We cannot assure you that we will be able to operate our business successfully or implement our operating policies and strategies described in this prospectus. We can provide no assurance that our performance will replicate the past performance of Cottonwood Residential O.P., LP, Cottonwood Residential, Inc., Cottonwood Residential II, Inc. or any program sponsored by Cottonwood Residential O.P., LP, Cottonwood Residential, Inc., or Cottonwood Residential II, Inc. Our investment returns could be substantially lower than the returns achieved by Cottonwood Residential O.P., LP., Cottonwood Residential, Inc. and Cottonwood Residential II, Inc. The results of our operations depend on several factors, including the availability of opportunities for the acquisition of target assets, the level and volatility of interest rates, the availability of short and long-term financing, and conditions in the financial markets and economic conditions.

We are dependent upon our advisor and its affiliates and any adverse changes in the financial health of our advisor or its affiliates or our relationship with them could hinder our operating performance and the return on our shareholders’ investment.

We are dependent on our advisor to manage our operations and our portfolio of multifamily apartment communities and multifamily real estate-related assets. Any adverse change in the financial condition of our advisor or our relationship with our advisor could hinder its ability to successfully manage our operations and our portfolio of investments.

Our ability to achieve our investment objectives and to conduct our operations is dependent upon the performance of our advisor, which is an affiliate of Cottonwood Residential O.P., LP, the operating partnership of Cottonwood Residential II, Inc., our sponsor. Cottonwood Residential II, Inc.’s and Cottonwood Residential O.P., LP’s business is sensitive to trends in the general economy, as well as the commercial real estate and credit markets. To the extent Cottonwood Residential II, Inc. no longer acts as our sponsor or any decline in its or Cottonwood Residential O.P., LP’s revenues and operating results impacts the performance of our advisor, our results of operations and financial condition could also suffer. If our relationship with our advisor, its affiliates and their real estate professionals is terminated for any reason, it will be difficult for us to implement our business strategy or manage our portfolio unless we engage another party to provide the services to be provided by our advisor, its affiliates and employees.

We have paid distributions from offering proceeds. In the future we may continue to fund distributions with offering proceeds. To the extent we fund distributions from sources other than our cash flow from operations, we will have less funds available for investment in multifamily apartment communities and multifamily real estate-related assets and the overall return to our shareholders may be reduced.

Our charter permits us to make distributions from any source, including offering proceeds or borrowings (which may constitute a return of capital), and our charter does not limit the amount of funds we may use from any source to pay such distributions. We intend to make distributions on our common stock on a per share basis with each share receiving the same distribution. If we fund distributions from financings, the proceeds from this or future offerings or other sources, we will have less funds available for investment in multifamily apartment communities and other multifamily real estate-related assets and the number of real estate properties that we invest in and the overall return to our shareholders may be reduced. If we fund distributions from borrowings, our interest expense and other financing costs, as well as the repayment of such borrowings, will reduce our earnings and cash flow from operations available for distribution in future periods. If we fund distributions from the sale of assets or the maturity, payoff or settlement of multifamily real estate-related assets, this will affect our ability to generate cash flows from operations in future periods.

We expect to have little, if any, cash flow from operations available for distribution until we make substantial investments. During the early stages of our operations, it is likely that we will use sources of funds, which may constitute a return of capital to fund distributions. During this offering stage, when we may raise capital more quickly than we acquire income-producing assets, and for some period after this offering stage, we may not be able to make distributions solely from our cash flow from operations. Further, because we may receive income from our investments at various times during our fiscal year and because we may need cash flow from operations during a particular period to fund capital expenditures and other expenses, we expect that at least during the early stages of our existence and from time to time during our operational stage, we will declare distributions in anticipation of cash flow that we expect to receive during a later period and we will make these distributions in advance of our actual receipt of these funds. In addition, to the extent our investments are in development or redevelopment projects or in properties that have significant capital requirements, our ability to make distributions may be

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negatively impacted, especially during our early periods of operation. In these instances, we expect to look to third party borrowings to fund our distributions. We may also fund such distributions from the sale of assets. To the extent distributions exceed cash flow from operations, a shareholder’s basis in our stock will be reduced and, to the extent distributions exceed a shareholder’s basis, the shareholder may recognize capital gain.

For the six months ended June 30, 2019, we paid aggregate distributions of $399,057, including $311,471 of distributions paid in cash and $87,586 of distributions reinvested through our distribution reinvestment plan. Our net loss for the six months ended June 30, 2019 was $934,223. Cash flows provided by operating activities for the six months ended June 30, 2019 was $364,861. We funded our total distributions paid, which includes net cash distributions and distributions reinvested by shareholders, with offering proceeds. Generally, for purposes of determining the source of our distributions paid, we assume first that we use cash flow from operating activities from the relevant or prior periods to fund distributions payments. However, due to the timing of the receipt of cash flow from operations in the second quarter of 2019, the cash was not available to fund distributions until July.

The value of a share of our common stock may be diluted if we pay stock dividends.

Our board of directors may declare stock dividends. Although there are a number of factors that would be considered in connection with such a declaration, we expect such stock dividends are most likely to be declared if our board of directors believes that (i) our portfolio has appreciated in value from its aggregate acquisition cost or (ii) additional sales of common stock in our offering at the current offering price would dilute the value of a share of our then existing shareholders. Phantom income could result from such stock dividends.

While our objective is to acquire assets that appreciate in value, there can be no assurance that assets we acquire will appreciate in value. If our board of directors declared a stock dividend for investors who purchase our shares early in this offering, as compared with later investors, those investors who received the stock dividends will receive more shares for the same cash investment as a result of any stock dividends. Because they own more shares, upon a sale or liquidation of the company, these early investors will receive more sales proceeds or liquidating distributions relative to their invested capital compared to later investors. Furthermore, unless our assets appreciate in an amount sufficient to offset the dilutive effect of the prior stock dividends, the value per share for later investors purchasing our stock will be below the value per share of earlier investors.

Our rights and the rights of our shareholders to recover claims against our officers and directors are limited, which could reduce your and our recovery against them if they negligently cause us to incur losses.

Maryland law provides that an officer or director has no liability in that capacity if he or she performs his or her duties in good faith, in a manner he or she reasonably believes to be in our best interests and with the care that an ordinarily prudent person in a like position would use under similar circumstances. Our charter provides that our officers and directors will not be liable to us or our shareholders for monetary damages and that we will generally indemnify them for losses unless our directors are negligent or engage in misconduct or our independent directors are grossly negligent or engage in willful misconduct. As a result, you and we may have more limited rights against our officers and directors than might otherwise exist under common law, which could reduce our and your recovery from these persons if they act in a negligent manner. Our charter also requires us, to the maximum extent permitted by Maryland law, to indemnify and, without requiring a preliminary determination of the ultimate entitlement to indemnification, pay or reimburse reasonable expenses in advance of the final disposition of a proceeding to any individual who is a present or former director or officer and who is made or threatened to be made a party to the proceeding by reason of his or her service in that capacity or any individual who, while a director or officer and at our request, serves or has served as a director, officer, partner, member, manager or trustee of another corporation, partnership, limited liability company, joint venture, trust, employment benefit plan or other enterprise and who is made or threatened to be made a party to the proceeding by reason of his or her service in that capacity.

We may change our targeted investments and our policies without shareholder consent.

We invest in multifamily apartment communities (including certain multifamily apartment communities that include certain retail or other commercial uses) and multifamily real estate-related assets. Except as described in this prospectus, we are not restricted as to the following:

• where we may acquire multifamily apartment communities in the United States;

• the percentage of our proceeds that may be invested in properties as compared with the percentage of our proceeds that we may invest in multifamily real estate-related assets; investment in direct interests in real estate and multifamily real estate-related assets will have differing risks and profit potential; or

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• the percentage of our proceeds that we may invest in any one real estate investment (the greater the percentage of our offering proceeds invested in one asset, the greater the potential adverse effect on us if that asset is unprofitable).

Although this prospectus describes our target portfolio, we may make adjustments to our target portfolio based on real estate market conditions and investment opportunities and we may change our targeted investments and investment guidelines at any time without the consent of our shareholders, which could result in our making investments that are different from, and possibly riskier than, the investments described in this prospectus. A change in our targeted investments or investment guidelines could adversely affect the value of our common stock and our ability to make distributions to you.

Our board of directors determines our major policies, including our policies regarding financing, growth, REIT qualification, NAV methodologies and distributions. Our board of directors may amend or revise these and other policies without a vote of the shareholders. Under Maryland General Corporation Law and our charter, our shareholders have a right to vote only on limited matters. Our board of director’s broad discretion in setting policies and our shareholders’ inability to exert control over those policies increases the uncertainty and risks you face as a shareholder.

Risks Related to Conflicts of Interest

Our advisor, our officers and the real estate, debt finance, legal, management and accounting professionals we retain will face competing demands on their time and this may cause our operations and our shareholders’ investment to suffer.

Subject to the supervision of our board of directors, we rely on our advisor, our officers, and the real estate, debt finance, legal, management, and accounting professionals that we retain to provide services to us for the day-to-day operation of our business. Our advisor and its affiliates have sponsored and advise other real estate programs and rely on many of the same real estate, debt finance, legal, management, and accounting professionals, as will future programs sponsored by our advisor and its affiliates. As a result of their interests in other programs sponsored by our advisor and their obligations to other investors, these professionals will likely face conflicts of interest in allocating their time among us and other programs sponsored by our advisor and its affiliates, as well as other business activities in which they are involved. During times of intense activity in other programs and ventures, these individuals may devote less time and fewer resources to our business than are necessary or appropriate to manage our business. If these events occur, the returns on our investments, and the value of your investment, may decline.

All of our executive officers, some of our directors and the key real estate and debt finance professionals we retain face conflicts of interest related to their positions and/or interests in our advisor, Cottonwood Residential O.P., LP, and its affiliates, which could hinder our ability to implement our business strategy and to generate returns to our shareholders.

All of our executive officers, some of our directors, and the key real estate and debt finance professionals we retain are also executive officers, directors and/or key professionals of our advisor, Cottonwood Residential O.P., LP and its affiliates. As a result, they owe fiduciary or other duties to each of these entities, their members and limited partners, which fiduciary or other duties may from time to time conflict with the fiduciary or other duties that they owe to us and our shareholders. Their loyalties to these other entities and investors could result in action or inaction that is detrimental to our business, which could harm the implementation of our business strategy and our investment and leasing opportunities. Cottonwood Communities Investor, LLC, a wholly owned subsidiary of Cottonwood Residential O.P., LP, will be a limited partner in our operating partnership and may have interests that are different than ours. If we do not successfully implement our business strategy, we may be unable to generate the cash needed to make distributions to our shareholders and to maintain or increase the value of our assets. Because some of our directors are also officers and directors of Cottonwood Residential II, Inc., they may make decisions regarding the management of the properties which are not in the best interests of our shareholders.

Conflicts of interest could result in our management acting other than in our shareholders’ best interest.

We are party to an advisory agreement with CC Advisors III, LLC. CC Advisors III, LLC is owned by Cottonwood Communities Advisors, LLC. Cottonwood Residential O.P., LP. is the sole shareholder in one of the three members and the manager of Cottonwood Communities Advisors, LLC. In addition, two of the members of Cottonwood Communities Advisors, LLC are owned by employees of Cottonwood Residential O.P., LP. Because our affiliated directors and certain of our officers are also current officers and directors of Cottonwood Residential II, Inc., and employees of Cottonwood Residential O.P., LP, and certain other officers are officers of the same members and manager of our advisor and have an indirect ownership interest in our advisor and the promotional interest from our operating partnership they may make decisions regarding the advisory agreement which are not in the best interests of our shareholders.

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Cottonwood Communities Advisors, LLC is also the sole member of two other entities that act as advisor to Cottonwood Multifamily REIT I, Inc. and Cottonwood Multifamily REIT II, Inc. We may compete with these and other affiliates of our advisor for opportunities to acquire or sell multifamily apartment communities and multifamily real estate-related assets, which may have an adverse impact on our operations. We may also buy or sell multifamily apartment communities and multifamily real estate-related assets at the same time as affiliates of our advisor. There may be a conflict of interest with respect to the selection of multifamily apartment communities and multifamily real estate-related assets to be purchased by us and/or our advisor and its affiliates. Affiliates of our advisor may own competing properties in the markets in which our multifamily apartment communities are located which may lead to conflicts of interests with respect to the operations and management of our multifamily apartment communities. For more details on how we and our advisor and its affiliates will handle potential investment opportunities see “Conflicts of Interest – Allocation of Investment Opportunities.”

The fees we pay to affiliates in connection with the management of our assets and investments were determined without the benefit of arm’s-length negotiations of the type normally conducted between unrelated parties.

The fees paid to our property manager and advisor for services it provides for us were determined without the benefit of arm’s-length negotiations of the type normally conducted between unrelated parties, may be in excess of amounts that we would otherwise pay to third parties for such services and may reduce the amount of cash that would otherwise be available for investments in multifamily apartment communities and multifamily real estate-related assets and distributions to our shareholders. In addition, the fees paid to our advisor could be different if our advisor did not pay our offering and organizational costs.

Our advisor faces conflicts of interest relating to the fees that we may pay to it and its affiliates, which could result in actions that are not necessarily in the long-term best interests of our shareholders.

Pursuant to our operating partnership agreement, Cottonwood Communities Investor, LLC is entitled to distributions (which right it has assigned to Cottonwood Communities Advisors Promote, LLC) that are structured to provide incentive to our advisor to perform in our best interests and in the best interests of our shareholders. Additionally, our advisor may be entitled to a contingent acquisition fee and a contingent financing fee if our common shareholders receive a specified return on their investment. The amount of such compensation has not been determined as a result of arm’s-length negotiations, and such amounts may be greater than otherwise would be payable to independent third parties. Because, however, our advisor is entitled to receive substantial minimum compensation regardless of performance, the interests of our advisor and its affiliates is not wholly aligned with those of our shareholders. In that regard, our advisor could be motivated to recommend riskier or more speculative investments in order for us to generate the specified levels of performance or sales proceeds that would entitle our advisor and its affiliates to additional compensation. In addition, Cottonwood Communities Advisors Promote, LLC’s potential participation in sale proceeds could result in our advisor recommending sales of our investments at the earliest possible time at which sales of investments would produce the level of return that would entitle Cottonwood Communities Advisors Promote, LLC to distributions relating to such sales, even if continued ownership of those investments might be in our best long-term interest.

Affiliates of our advisor have sponsored other entities and offerings and may sponsor additional entities and offerings in the future.

Affiliates of our advisor act as the advisor to Cottonwood Multifamily REIT I, Inc. and Cottonwood Multifamily REIT II, Inc. which have investment objectives that are similar to ours. In addition, it is possible that our advisor or its affiliates may form future REITs and sponsor other entities and offerings that may invest in assets that are similar to the multifamily apartment communities and multifamily real estate-related assets we intend to acquire. As a result, the conflicts of interest with respect to time, selection of investments and management of our investments may increase if our advisor or its affiliates sponsor additional programs.

If the advisory agreement with our advisor is terminated on or before August 13, 2028 for any reason other than because of the fraud, gross negligence or willful misconduct of our advisor, we will be required to pay the accrued contingent acquisition fees and accrued contingent financing fees.

Our advisor is entitled to receive contingent acquisition fees related to our purchase of multifamily apartment communities and multifamily real estate-related assets and contingent financing fees related to our financing of multifamily apartment communities and multifamily real estate-related assets. Our advisor has agreed to defer the payment of any acquisition fee or financing fee until our common shareholders’ receipt of certain specified returns. However, if the advisory agreement is terminated before August 13, 2028, for any reason other than the fraud, gross negligence or willful misconduct of our advisor, the acquisition fees and financing fees will become immediately due and payable by us. Thus, there may be conflicts of interest with respect to the termination of the advisory agreement and the payment of the contingent acquisition fees and contingent financing fees.

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Our advisor may assign its obligations under the advisory agreement to its affiliates, who may not have the same expertise or provide the same level of service as our advisor.

Under the advisory agreement, our advisor may assign its responsibilities under the agreement to any of its affiliates with the approval of the conflicts committee. If there is such an assignment or transfer, the assignee may not have comparable operational expertise, have sufficient personnel or manage our company as well as our advisor.

Risks Related to This Offering and Our Corporate Structure

Our charter limits the number of shares a person may own, which may discourage a takeover that could otherwise result in a premium price to our shareholders.

Our charter, with certain exceptions, authorizes our directors to take such actions as are necessary and desirable to preserve our qualification as a REIT. To help us comply with the REIT ownership requirements of the Internal Revenue Code, our charter prohibits a person from directly or constructively owning more than 9.8% of our outstanding shares, unless exempted by our board of directors. This restriction may have the effect of delaying, deferring, or preventing a change in control of us, including an extraordinary transaction (such as a merger, tender offer or sale of all or substantially all of our assets) that might provide a premium price for holders of our common stock.

Our charter permits our board of directors to issue stock with terms that may subordinate the rights of our common shareholders or discourage a third party from acquiring us in a manner that could result in a premium price to our shareholders.

Our board of directors may classify or reclassify any unissued common stock or preferred stock and establish the preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends and other distributions, qualifications and terms or conditions of redemption of any such stock. Thus, our board of directors could authorize the issuance of preferred stock with priority as to distributions and amounts payable upon liquidation over the rights of the holders of our common stock. Such preferred stock could also have the effect of delaying, deferring or preventing a change in control of us, including an extraordinary transaction (such as a merger, tender offer or sale of all or substantially all of our assets) that might provide a premium price to holders of our common stock.

Our charter designates the Circuit Court for Baltimore City, Maryland as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our shareholders, which could limit our shareholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees.

Our charter provides that, unless we consent in writing to the selection of an alternative forum, the Circuit Court for Baltimore City, Maryland shall be the sole and exclusive forum for (a) any derivative action or proceeding brought on our behalf, (b) any action or proceeding asserting a claim of breach of any duty owed by any of our directors or officers or other employees to us or to our shareholders, (c) any action or proceeding asserting a claim arising pursuant to any provision of the Maryland General Corporation Law or our charter or our bylaws, or (d) any action or proceeding asserting a claim that is governed by the internal affairs doctrine, and any of our record or beneficial shareholders who is a party to such an action or proceeding shall cooperate in any request that we may make that the action or proceeding be assigned to the Court’s Business and Technology Case Management Program. We note we currently have no employees. This choice of forum provision may limit a shareholder’s ability to bring a claim in a judicial forum that the shareholder believes is favorable for disputes with us or our directors, officers or employees, which may discourage meritorious claims from being asserted against us and our directors, officers and employees. Alternatively, if a court were to find this provision of our bylaws inapplicable to, or unenforceable in respect of, one or more of the specified types of actions or proceedings, we may incur additional costs associated with resolving such matters in other jurisdictions, which could adversely affect our business, financial condition or results of operations. We adopted this provision because we believe it makes it less likely that we will be forced to incur the expense of defending duplicative actions in multiple forums and less likely that plaintiffs’ attorneys will be able to employ such litigation to coerce us into otherwise unjustified settlements, and we believe the risk of a court declining to enforce this provision is remote, as the General Assembly of Maryland has specifically amended the Maryland General Corporation Law to authorize the adoption of such provisions. The exclusive forum provision of our charter does not establish exclusive jurisdiction in the Circuit Court for Baltimore City, Maryland for claims that arise under the Securities Act, the Exchange Act or other federal securities laws if there is exclusive or concurrent jurisdiction in the federal courts.

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Your investment return may be reduced if we are required to register as an investment company under the Investment Company Act; if our subsidiaries or we become an unregistered investment company, then we could not continue our business.

Neither we nor any of our subsidiaries intend to register as investment companies under the Investment Company Act. If we or our subsidiaries were obligated to register as investment companies, then we would have to comply with a variety of substantive requirements under the Investment Company Act that impose, among other things:

• limitations on capital structure;

• restrictions on specified investments;

• prohibitions on transactions with affiliates; and

• compliance with reporting, record keeping, voting, proxy disclosure and other rules and regulations that would significantly increase our operating expenses.

Under the relevant provisions of Section 3(a)(1) of the Investment Company Act, an investment company is any issuer that:

• pursuant to Section 3(a)(1)(A), is or holds itself out as being engaged primarily, or proposes to engage primarily, in the business of investing, reinvesting or trading in securities (the “primarily engaged test”); or

• pursuant to Section 3(a)(1)(C), is engaged or proposes to engage in the business of investing, reinvesting, owning, holding or trading in securities and owns or proposes to acquire “investment securities” having a value exceeding 40% of the value of such issuer’s total assets (exclusive of United States government securities and cash items) on an unconsolidated basis (the “40% test”). “Investment securities” excludes United States government securities and securities of majority-owned subsidiaries that are not themselves investment companies and are not relying on the exception from the definition of investment company under Section 3(c)(1) or Section 3(c)(7) (relating to private investment companies).

Neither we nor our Operating Partnership should be required to register as an investment company under either of the tests above. With respect to the 40% test, most of the entities through which we and our Operating Partnership will own our assets will be majority-owned subsidiaries that will not themselves be investment companies and will not be relying on the exceptions from the definition of investment company under Section 3(c)(1) or Section 3(c)(7) (relating to private investment companies).

With respect to the primarily engaged test, we and our Operating Partnership will be holding companies and do not intend to invest or trade in securities ourselves. Rather, through the majority-owned subsidiaries of our Operating Partnership, we and our Operating Partnership will be primarily engaged in the non-investment company businesses of these subsidiaries, namely the business of purchasing or otherwise acquiring real estate and real estate-related assets.

If any of the subsidiaries of our Operating Partnership fail to meet the 40% test, then we believe they will often be able to rely on Section 3(c)(5)(C) of the Investment Company Act for an exception from the definition of an investment company. As reflected in no-action letters, the SEC staff’s position on Section 3(c)(5)(C) generally requires that an issuer maintain at least 55% of its assets in “mortgages and other liens on and interests in real estate” or qualifying assets; at least 80% of its assets in qualifying assets plus real estate-related assets; and no more than 20% of the value of its assets in other than qualifying assets and real estate-related assets. To constitute a qualifying asset under this 55% requirement, a real estate interest must meet various criteria based on no-action letters. We expect that any of the subsidiaries of our Operating Partnership relying on Section 3(c)(5)(C) will invest at least 55% of its assets in qualifying assets, with substantially all of its remaining assets in other types of real estate-related assets. If any subsidiary relies on Section 3(c)(5)(C), then we expect to rely on guidance published by the SEC staff or on our analyses of guidance published with respect to types of assets to determine which assets are qualifying real estate assets and real estate-related assets.

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To maintain compliance with the Investment Company Act, our subsidiaries may be unable to sell assets we would otherwise want them to sell and may need to sell assets we would otherwise wish them to retain. In addition, our subsidiaries may have to acquire additional assets that they might not otherwise have acquired or may have to forego opportunities to make investments that we would otherwise want them to make and would be important to our investment strategy. Moreover, the SEC or its staff may issue interpretations with respect to various types of assets that are contrary to our views and current SEC staff interpretations are subject to change, which increases the risk of non-compliance and the risk that we may be forced to make adverse changes to our portfolio. In this regard, we note that in 2011 the SEC issued a concept release indicating that the SEC and its staff were reviewing interpretive issues relating to Section 3(c)(5)(C) and soliciting views on the application of Section 3(c)(5)(C) to companies engaged in the business of acquiring mortgages and mortgage related instruments. If we were required to register as an investment company but failed to do so, we would be prohibited from engaging in our business and criminal and civil actions could be brought against us. In addition, our contracts would be unenforceable unless a court required enforcement and a court could appoint a receiver to take control of us and liquidate our business. See the “Investment Objectives and Criteria —Investment Limitations Under the Investment Company Act of 1940” section of this prospectus.

Rapid changes in the values of our assets may make it more difficult for us to maintain our qualification as a REIT or our exception from the definition of an investment company under the Investment Company Act.

If the market value or income potential of our qualifying real estate assets changes as compared to the market value or income potential of our non-qualifying assets, or if the market value or income potential of our assets that are considered “real estate-related assets” under the Investment Company Act or REIT qualification tests changes as compared to the market value or income potential of our assets that are not considered “real estate-related assets” under the Investment Company Act or REIT qualification tests, whether as a result of increased interest rates, prepayment rates or other factors, we may need to modify our investment portfolio in order to maintain our REIT qualification or exception from the definition of an investment company. If the decline in asset values or income occurs quickly, this may be especially difficult, if not impossible, to accomplish. This difficulty may be exacerbated by the illiquid nature of many of the assets that we may own. We may have to make investment decisions that we otherwise would not make absent REIT and Investment Company Act considerations.

Actions of our potential future joint venture partners could reduce the returns on joint venture investments and decrease our shareholders’ overall return.

We may enter into joint ventures with third parties or affiliates to acquire assets. We may also purchase and develop properties in joint ventures or in partnerships, co-tenancies or other co-ownership arrangements. Such investments may involve risks not otherwise present with other methods of investment, including, for example, the following risks:

• that our co-venturer, co-tenant or partner in an investment could become insolvent or bankrupt;

• that such co-venturer, co-tenant or partner may at any time have economic or business interests or goals that are or that become inconsistent with our business interests or goals;

• that such co-venturer, co-tenant or partner may be in a position to take action contrary to our instructions or requests or contrary to our policies or objectives; or

• that disputes between us and our co-venturer, co-tenant or partner may result in litigation or arbitration that would increase our expenses and prevent our officers and directors from focusing their time and effort on our operations.

Any of the above might subject a property to liabilities in excess of those contemplated and thus reduce our returns on that investment and the value of our shareholders’ investment in us.

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Our shareholders may not be able to sell their shares under our share repurchase program and, if our shareholders are able to sell their shares under the program, they may not be able to recover the amount of their investment in our shares.

Our share repurchase program includes numerous restrictions that limit your ability to sell your shares. You generally must hold your shares for at least one year in order to participate in our share repurchase program, except for Exceptional Repurchases. We limit the number of shares repurchased pursuant to our share repurchase program in any calendar year to 5% of the weighted-average number of shares outstanding during the prior calendar year. In addition, during any calendar year, we may redeem only the number of shares that we could purchase with the amount of net proceeds from the sale of shares under our distribution reinvestment plan during the prior calendar year. We have no obligation to repurchase shares if the repurchase would violate the restrictions on distributions under Maryland law, which prohibits distributions that would cause a corporation to fail to meet statutory tests of solvency. These limits may prevent us from accommodating all repurchase requests made in any year.

Under our share repurchase program, shares may be repurchased at varying prices depending on (a) the number of years the shares have been held, (b) the estimated value per share and (c) whether the repurchases are Exceptional Repurchases. Thus, if your shares are repurchased by us pursuant to our share repurchase program, it is possible that you will receive less than the fair market value of the shares at the time of such repurchase.

Our board of directors may amend, suspend or terminate our share repurchase program upon 15 days’ notice to our shareholders. See “Description of Shares—Share Repurchase Program” for more information about the program. The restrictions of our share repurchase program will severely limit your ability to sell your shares should you require liquidity and limit your ability to recover the value you invest in our common stock.

The offering price of our shares was not established in reliance on a valuation of our assets and liabilities; the actual value of your investment may be substantially less than what you pay.

We established the offering price of our shares on an arbitrary basis. The selling price of our shares bears no relationship to our book or asset values or to any other established criteria for valuing shares. We plan to determine the net asset value of our common stock no later than May 17, 2021, and annually thereafter. Our net asset value will be determined based on valuations of our assets and liabilities by, or with the material assistance or confirmation of, a third-party valuation expert or service. The method used in any year will be selected by our board of directors.

To assist FINRA members and their associated persons that participate in this offering, we intend to disclose in each annual report distributed to shareholders a per share estimated value of our shares developed in a manner reasonably designed to ensure it is reliable, the method by which it was developed and the date of the estimated valuation.

Our investors’ interest in us will be diluted if we issue additional shares, which could reduce the overall value of their investment.

Potential investors in this offering will not have preemptive rights to any shares we issue in the future. Our charter authorizes us to issue 1,100,000,000 shares of capital stock, of which 1,000,000,000 shares are designated as common stock and 100,000,000 shares are designated as preferred stock. We are only issuing up to 67,500,000 shares of common stock pursuant to this primary offering and up to 7,500,000 shares pursuant to our distribution reinvestment plan. Our board of directors may increase the number of authorized shares of capital stock without shareholder approval. After your purchase in this offering, our board of directors may elect to (i) sell additional shares in this or future offerings, (ii) issue equity interests in private offerings or (iii) otherwise issue additional shares of our capital stock. To the extent we issue additional equity interests after your purchase in this offering your percentage ownership interest in us would be diluted. In addition, depending upon the terms and pricing of any additional offerings, the use of the proceeds and the value of our real estate investments, you may also experience dilution in the book value and fair value of your shares and in the earnings and distributions per share.

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Payment of substantial fees and expenses to our advisor and its affiliates will reduce the return to you and increases the risks that you will not be able to recover the amount of your investment in our shares.

We pay significant fees to our advisor and its affiliates during our operational stage. Those fees include property management fees and asset management fees and we may have the obligation to reimburse our advisor and its affiliates for certain expenses they incur in connection with their providing services to us. In addition, we may be required to pay the contingent acquisition fees and contingent financing fees if we terminate the advisory agreement with our advisor.

We will also pay significant fees during our liquidation stage. Cottonwood Communities Advisors Promote, LLC will receive a 15% promotional interest from our operating partnership after our common shareholders have received, together as a collective group, aggregate distribution sufficient to provide a return of their invested capital, plus a 6% cumulative, non-compounded annual return on their invested capital.

These fees and other potential payments increase the risk that the amount available for distribution to common shareholders upon a liquidation of our portfolio would be less than the purchase price of the shares in this offering. Substantial consideration paid to our advisor and its affiliates also increases the risk that you will not be able to resell your shares at a profit, even if our shares are listed on a national securities exchange. See “Management Compensation.”

If we are unable to obtain funding for future cash needs, cash distributions to our shareholders could be reduced and the value of our investments could decline.

If we need additional capital in the future to improve or maintain our multifamily apartment communities or for any other reason, we may have to obtain financing from sources beyond our cash flow from operations, such as borrowings, sales of assets or future equity offerings. These sources of funding may not be available on attractive terms or at all. If we cannot procure additional funding for capital improvements, our investments may generate lower cash flows or decline in value, or both, which would limit our ability to make distributions to you and could reduce the value of your investment.

Although we will not currently be afforded the protection of the Maryland General Corporation Law relating to deterring or defending hostile takeovers, our board of directors could opt into these provisions of Maryland law in the future, which may discourage others from trying to acquire control of us and may prevent our shareholders from receiving a premium price for their shares in connection with a business combination.

Under Maryland law, “business combinations” between a Maryland corporation and certain interested shareholders or affiliates of interested shareholders are prohibited for five years after the most recent date on which the interested shareholder becomes an interested shareholder. These business combinations include a merger, consolidation, share exchange, or, in circumstances specified in the statute, an asset transfer or issuance or reclassification of equity securities. Also under Maryland law, control shares of a Maryland corporation acquired in a control share acquisition have no voting rights except to the extent approved by a vote of two-thirds of the votes entitled to be cast on the matter. Shares owned by the acquirer, an officer of the corporation, or an employee of the corporation who is also a director of the corporation are excluded from the vote on whether to accord voting rights to the control shares. Should our board of directors opt into these provisions of Maryland law, it may discourage others from trying to acquire control of us and increase the difficulty of consummating any offer. Similarly, provisions of Title 3, Subtitle 8 of the Maryland General Corporation Law could provide similar anti-takeover protection. For more information about the business combination, control share acquisition and Subtitle 8 provisions of Maryland law, see “Description of Shares—Business Combinations” and “Description of Shares—Control Share Acquisitions.”

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Because Maryland law permits our board of directors to adopt certain anti-takeover measures without shareholder approval, investors may be less likely to receive a “control premium” for their shares.

In 1999, the State of Maryland enacted legislation that enhances the power of Maryland corporations to protect themselves from unsolicited takeovers. Among other things, the legislation permits our board, without shareholder approval, to amend our charter to:

• stagger our board of directors into three classes;

• require a two-thirds shareholder vote for removal of directors;

• provide that only the board can fix the size of the board;

• provide that all vacancies on the board, however created, may be filled only by the affirmative vote of a majority of the remaining directors in office; and

• require that special shareholder meetings may only be called by holders of a majority of the voting shares entitled to be cast at the meeting.

Under Maryland law, a corporation can opt to be governed by some or all of these provisions if it has a class of equity securities registered under the Exchange Act, and has at least three independent directors. Our charter does not prohibit our board from opting into any of the above provisions permitted under Maryland law. Becoming governed by any of these provisions could discourage an extraordinary transaction (such as a merger, tender offer or sale of all or substantially all of our assets) that might provide a premium price for holders of our securities. For more information about Subtitle 8 provisions of Maryland law discussed here, see “Description of Shares—Subtitle 8.”

Our ability to successfully conduct our offering is dependent, in part, on the ability of the dealer manager to hire and retain key employees and to successfully establish, operate and maintain a network of broker-dealers.

The dealer manager for this offering is Orchard Securities, LLC, a Utah limited liability company, which we refer to as our dealer manager. The success of this offering and our ability to implement our business strategy is dependent upon the ability of the dealer manager to hire and retain key employees and to establish, operate and maintain a network of licensed securities broker-dealer, or selling group members. Some or all of the broker dealers in this network have a choice of numerous competing real estate investment trusts offerings, many with similar investment objectives to recommend to their clients, which may make selling our shares to their clients more difficult. If our dealer manager is unable to hire qualified employees and build a sufficient network of selling group members, we may not be able to raise adequate proceeds through this offering to implement our investment strategy. If we are unsuccessful in implementing our investment strategy, you could lose all or a part of your investment.

Breaches of our data security could materially harm us, including our business, financial performance and reputation.

We collect and retain certain personal information provided by our residents and employees. Security measures we have implemented to protect the confidentiality of this information may not prevent unauthorized access to this information. Any breach of our data security measures and loss of this information may result in legal liability and costs (including damages and penalties), as well as damage to our reputation, that could materially and adversely affect us, including our business and financial performance.

Some of the prior programs of the indirect owner of our sponsor, Cottonwood Residential O.P., LP and its predecessor entities, have not met the anticipated performance levels.

Cottonwood Residential O.P., LP and its predecessor, Cottonwood Capital, LLC have sponsored a number of prior real estate programs. Some of these prior real estate programs have not achieved the leasing and operational thresholds projected by Cottonwood Residential O.P, LP or Cottonwood Capital, LLC. As a result, the returns to investors in some of these prior real estate programs may not have met the expected thresholds. See “Prior Performance Summary.”

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General Risks Related to Investments in Real Estate

We will not be diversified with respect to the class of assets that we own.

We will invest, through our operating partnership, solely in multifamily apartment communities and multifamily real estate-related assets. While we intend to invest in a significant number of properties across several geographical locations and markets, we will not invest in a diverse set of asset classes. Further, we have no plans to acquire any assets other than assets consisting of multifamily apartment communities and multifamily real estate-related assets. Therefore, each of our investments could be subject to the same or similar rental property related risks and a decline in real estate values in general or a change in economic conditions which affects real property investment and rental markets could have a substantial adverse effect on our financial performance.

If capitalization rates increase the value of our assets may decrease and we may not be able to sell our assets at anticipated prices.

The value of real estate is generally based on capitalization rates. Capitalization rates generally trend with interest rates. Consequently, if interest rates go up, so do capitalization rates. Based on historical interest rates, current interest rates are low, as are current capitalization rates. However, if interest rates rise in the future, it is likely that capitalization rates will also rise, and as a result, the value of real estate will decrease. If capitalization rates increase, our assets will likely achieve a lower sales price than anticipated, resulting in reduced returns.

There are risks inherent in the acquisition and management of multifamily apartment communities.

There are risks associated with the operation of multifamily apartment communities, including, but not limited to, vacillations in the demand for residential space; risk of loss or damage to the improvements or property of tenants; environmental risks and other risks associated with ownership of real estate. Any of the above factors, or a combination thereof, could result in a decrease in the value of our investments which would have an adverse effect on our results of operations, reduce the cash flow available for distributions and the return on your investment.

Rental levels at the multifamily apartment communities that we acquire can vary over time and we may not be able to maintain the occupancy rates we anticipate.

We will make our determination regarding the acquisition of multifamily apartment communities that we acquire based, among other things, on the property’s projected rent levels. However, there can be no assurance that a multifamily apartment community will continue to be occupied at the projected rents. It is anticipated that leases with the tenants at our multifamily apartment communities will generally be for terms of one year or less. If the tenants of the properties do not renew or extend their leases, if tenants default under their leases at the properties, if issues arise with respect to the permissibility of certain uses at the properties, if tenants of the properties terminate their leases, or if the terms of any renewal (including concessions to the tenants) are less favorable than existing lease terms, the operating results of the properties could be substantially affected. As a result, we may not be able to make distributions to the shareholders at the anticipated levels.

Because we rely on Cottonwood Communities Management, its affiliates and third parties to manage the day-to-day affairs of any properties we may acquire, should the staff of a particular property perform poorly, our operating results for that property will similarly be hindered and our net income may be reduced.

We depend upon the performance of our property managers to effectively manage our properties and real estate-related assets. Rising vacancies across real estate properties have resulted in increased pressure on real estate investors and their property managers to maintain adequate occupancy levels. In order to do so, we may have to offer inducements, such as free rent and resident amenities, to compete for residents. Poor performance by those sales, leasing and other management staff members operating a particular property will necessarily translate into poor results of operations for that particular property. Should Cottonwood Communities Management, its affiliates or third parties fail to identify problems in the day-to-day management of a particular property or fail to take the appropriate corrective action in a timely manner, our operating results may be hindered and our net income reduced.

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It may be difficult for us to attract new tenants to our multifamily apartment communities.

There can be no assurance that we will be able to maintain the occupancy rates at our multifamily apartment communities. The tenants at any multifamily apartment communities may have the right to terminate their leases upon the occurrence of specified events. It is anticipated that the majority of leases at the properties will be for terms of one year or less.

Our inability to sell a multifamily apartment community at the time and on the terms we want could limit our ability to pay cash distributions to our shareholders.

Many factors that are beyond our control affect the real estate market and could affect our ability to sell multifamily apartment communities for the price, on the terms or within the time frame that we desire. These factors include general economic conditions, the availability of financing, interest rates and other factors, including supply and demand. Because real estate investments are relatively illiquid, we have a limited ability to vary our portfolio in response to changes in economic or other conditions. Further, before we can sell a multifamily apartment community on the terms we want, it may be necessary to expend funds to correct defects or to make improvements. However, we can give no assurance that we will have the funds available to correct such defects or to make such improvements. We may be unable to sell our multifamily apartment communities at a profit. Our inability to sell multifamily apartment communities at the time and on the terms we want could reduce our cash flow and limit our ability to make distributions to our shareholders and could reduce the value of your investment.

We may have no or only limited recourse for any problems later identified for multifamily apartment communities we acquire, which could materially and adversely affect us, including our results of operations.

We anticipate sellers of multifamily apartment communities will sell such properties “as is,” “where is” and “with all faults,” without any warranties of merchantability or fitness for a particular use or purpose. In addition, purchase and sale agreements may contain limited warranties, representations and indemnifications that will only survive for a limited period after the closing. The purchase of multifamily apartment communities with no or limited warranties increases the risk that we may lose some or all of our invested capital in the property, as well as the loss of rental income from that multifamily apartment community, which could materially and adversely affect us.

Costs imposed pursuant to governmental laws and regulations may reduce our net income and the cash available for distributions to our shareholders.

Real property and the operations conducted on real property are subject to federal, state and local laws and regulations relating to protection of the environment and human health. We could be subject to liability in the form of fines, penalties or damages for noncompliance with these laws and regulations. These laws and regulations generally govern wastewater discharges, air emissions, the operation and removal of underground and above-ground storage tanks, the use, storage, treatment, transportation and disposal of solid and hazardous materials, the remediation of contamination associated with the release or disposal of solid and hazardous materials, the presence of toxic building materials and other health and safety-related concerns.

Some of these laws and regulations may impose joint and several liability on the tenants, owners or operators of real property for the costs to investigate or remediate contaminated properties, regardless of fault, whether the contamination occurred prior to purchase, or whether the acts causing the contamination were legal. Activities of our tenants, the condition of properties at the time we buy them, operations in the vicinity of our properties, such as the presence of underground storage tanks, or activities of unrelated third parties may affect our properties.

The presence of hazardous substances, or the failure to properly manage or remediate these substances, may hinder our ability to sell, rent, or pledge such property as collateral for future borrowings. Any material expenditures, fines, penalties or damages we must pay will reduce our ability to make distributions and may reduce the value of your investment.

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Potential liability for environmental matters could adversely affect our financial condition.

Although we intend to subject our multifamily apartment communities to an environmental assessment prior to acquisition, we may not be made aware of all the environmental liabilities associated with a property prior to its purchase. There may be hidden environmental hazards that may not be discovered prior to acquisition. The costs of investigation, remediation or removal of hazardous substances may be substantial. In addition, the presence of hazardous substances on one of our properties, or the failure to properly remediate a contaminated property, could adversely affect our ability to sell or rent the property or to borrow using the property as collateral.

Various federal, state and local environmental laws impose responsibilities on an owner or operator of real estate and subject those persons to potential joint and several liabilities. Typical provisions of those laws include:

• responsibility and liability for the costs of investigation, removal, or remediation of hazardous substances released on or in real property, generally without regard to knowledge of or responsibility for the presence of the contaminants;

• liability for claims by third parties based on damages to natural resources or property, personal injuries, or costs of removal or remediation of hazardous or toxic substances in, on, or migrating from our property;

• responsibility for managing asbestos-containing building materials, and third-party claims for exposure to those materials; and

• environmental laws also may impose restrictions on the manner in which property may be used or businesses may be operated, and these restrictions may require expenditures.

Costs associated with complying with the Americans with Disabilities Act and the Fair Housing Amendment Act may decrease cash available for distributions.

Our properties may be subject to the Americans with Disabilities Act of 1990, as amended, or the Disabilities Act and the Fair Housing Amendment Act, as amended, or the Fair Housing Act. Under the Disabilities Act, all places of public accommodation are required to comply with federal requirements related to access and use by disabled persons and may require owners of multifamily dwellings to make reasonable exceptions in their policies and operations to afford people with disabilities equal housing opportunities. The Disabilities Act has separate compliance requirements for “public accommodations” and “commercial facilities” that generally require that buildings and services be made accessible and available to people with disabilities. The Disabilities Act’s requirements could require removal of access barriers and could result in the imposition of injunctive relief, monetary penalties, or, in some cases, an award of damages. The Fair Housing Act requires multifamily dwellings first occupied after March 13, 1991 to comply with design and construction requirements related to access and use by disabled persons. Any funds used for Disabilities Act and Fair Housing Act compliance will reduce our net income and the amount of cash available for distributions to you.

Uninsured losses relating to real property or excessively expensive premiums for insurance coverage could reduce our cash flows and the return on our shareholders’ investment.

There are types of losses, generally catastrophic in nature, such as losses due to wars, acts of terrorism, earthquakes, floods, hurricanes, pollution, or environmental matters that are uninsurable or not economically insurable, or may be insured subject to limitations, such as large deductibles or co-payments. Insurance risks associated with potential acts of terrorism could sharply increase the premiums we pay for coverage against property and casualty claims. Additionally, mortgage lenders in some cases have begun to insist that commercial property owners purchase coverage against terrorism as a condition for providing mortgage loans. Such insurance policies may not be available at reasonable costs, which may increase our cost of obtaining financing. We may not have adequate coverage for such losses. If any of our properties incurs a casualty loss that is not fully insured, the value of our assets will be reduced by any such uninsured loss, which may reduce the value of your investment. In addition, other than any working capital reserve or other reserves we may establish, we have no source of funding to repair or reconstruct any uninsured property. Also, to the extent we must pay unexpectedly large amounts for insurance, we could suffer reduced earnings that would result in lower distributions to you.

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The properties will include certain amenities for the residents at the properties that could increase the potential liabilities at the properties.

In addition to the apartment buildings, the properties will be improved with various amenities, such as swimming pools, exercise rooms, playgrounds, laundry facilities, business centers and/or rentable club houses. Certain claims could arise in the event that a personal injury, death, or injury to property should occur in, on, or around any of these improvements. In addition, certain of the multifamily apartment communities may be located in areas where dangerous wildlife lives which could pose dangers to the residents at the applicable property. There can be no assurance that particular risks pertaining to these improvements that currently may be insured will continue to be insurable on an economical basis or that current levels of coverage will continue to be available. If a loss occurs that is partially or completely uninsured, we may lose all or part of the investment. We may be liable for any uninsured or underinsured personal injury, death or property damage claims. Liability in such cases may be unlimited but shareholders will not be personally liable.

Competition and any increased affordability of single-family residential homes could limit our ability to lease our apartments or maintain or increase rents, which may materially and adversely affect us, including our financial condition, cash flows, results of operations and growth prospects.

The multifamily industry is highly competitive, and we face competition from many sources, including from other multifamily apartment communities both in the immediate vicinity and the geographic markets where our properties are and will be located. If so, this would increase the number of apartment units available and may decrease occupancy and unit rental rates. Furthermore, multifamily apartment communities we acquire compete, or will compete, with numerous housing alternatives in attracting residents, including owner occupied single and multifamily homes available to rent or purchase. The number of competitive properties and/or condominiums in a particular area, or any increased affordability of owner occupied single and multifamily homes caused by declining housing prices, mortgage interest rates and government programs to promote home ownership, could adversely affect our ability to retain our residents, lease apartment units and maintain or increase rental rates. These factors could materially and adversely affect us.

Increased construction of similar multifamily apartment communities that compete with our properties in any particular location may materially and adversely affect us, including our results of operations and our cash available for distribution to our shareholders.

We may acquire multifamily apartment communities in locations that experience increases in construction of properties that compete with our properties. This increased competition and construction could make it more difficult for us to find residents to lease units in our multifamily apartment communities and/or force us to lower our rental rates in order to lease units in our properties, which could substantially reduce our revenues and could have a material adverse effect on us. In addition, overbuilding of multifamily apartment communities may occur.

We may be unable to secure funds for future capital improvements, which could adversely impact our ability to make cash distributions to our shareholders.

When residents do not renew their leases or otherwise vacate their apartment unit, in order to attract replacement residents, we may be required to expend funds for capital improvements to the vacated apartment homes. In addition, we may require substantial funds to renovate a multifamily apartment community in order to sell it, upgrade it or reposition it in the market. If we have insufficient capital reserves, we will have to obtain financing from other sources. We intend to establish capital reserves in an amount we, in our discretion, believe is necessary. A lender also may require escrow of capital reserves in excess of any established reserves. If these reserves or any reserves otherwise established are designated for other uses or are insufficient to meet our cash needs, we may have to obtain financing from either affiliated or unaffiliated sources to fund our cash requirements. We cannot assure our shareholders that sufficient financing will be available or, if available, will be available on economically feasible terms or on terms acceptable to us. Moreover, certain reserves required by lenders may be designated for specific uses and may not be available for capital purposes such as future capital improvements. Additional borrowing for capital needs and capital improvements will increase our interest expense, and therefore our financial condition and our ability to make cash distributions to our shareholders may be adversely affected.

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Our multifamily apartment communities are subject to property taxes that may increase in the future, which could adversely affect our cash flow.

Our multifamily apartment communities are subject to real and personal property taxes that may increase as tax rates change and as the multifamily apartment communities are assessed or reassessed by taxing authorities. As the owner of the multifamily apartment communities, we are ultimately responsible for payment of the taxes to the applicable government authorities. If we fail to pay any such taxes, the applicable taxing authority may place a lien on the real property and the real property may be subject to a tax sale.

Increases in costs to own and maintain our properties may materially and adversely affect us, including our results of operations and cash flows.

We may experience increased costs associated with operating expenses, including capital improvements, routine property maintenance, real estate taxes and utility expenses. Any increases in our expenses to own and maintain our properties would consequently reduce our results of operations and cash flows.

Potential development and construction delays and resultant increased costs and risks may hinder our operating results and decrease our net income.

From time to time we may acquire unimproved real property or properties that are under development or construction. Investments in such properties will be subject to the uncertainties associated with the development and construction of real property, including those related to re-zoning land for development, environmental concerns of governmental entities and/or community groups and our builders’ ability to build in conformity with plans, specifications, budgeted costs and timetables. If a builder fails to perform, we may resort to legal action to rescind the purchase or the construction contract or to compel performance. A builder’s performance may also be affected or delayed by conditions beyond the builder’s control. Delays in completing construction could also give tenants the right to terminate preconstruction leases. We may incur additional risks when we make periodic progress payments or other advances to builders before they complete construction. These and other factors can result in increased costs of a project or loss of our investment. In addition, we will be subject to normal lease-up risks relating to newly constructed projects. We also must rely on rental income and expense projections and estimates of the fair market value of property upon completion of construction when agreeing upon a purchase price at the time we acquire the property. If our projections are inaccurate, we may pay too much for a property, and the return on our investment could suffer.

Risks Related to Multifamily Real Estate-Related Assets

Our investments in multifamily real estate-related assets will be subject to the risks typically associated with real estate.

Our investments in mortgage, mezzanine or other real estate loans will generally be directly or indirectly secured by a lien on real property (or the equity interests in an entity that owns real property) that, upon the occurrence of a default on the loan, could result in our taking ownership of the entity that owns the real estate. We will not know whether the values of the multifamily apartment communities ultimately indirectly securing our loans will remain at the levels existing on the dates of origination or acquisition of those loans. If the values of the underlying multifamily apartment communities drop, our risk will increase because of the lower value of the security associated with such loans. In this manner, real estate values could impact the values of our loan investments. Therefore, our multifamily real estate-related assets will be subject to the risks typically associated with real estate, which are described above under the heading “General Risks Related to Investments in Real Estate.”

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Any mortgage loans we acquire or originate and the mortgage loans underlying any mortgage securities we may invest in are subject to delinquency, foreclosure and loss, which could result in losses to us.

Commercial real estate loans generally are secured by commercial real estate properties and are subject to risks of delinquency and foreclosure. The ability of a borrower to repay a loan secured by an income-producing property typically is dependent primarily upon the successful operation of such property rather than upon the existence of independent income or assets of the borrower. If the net operating income of the property is reduced, the borrower’s ability to repay the loan may be impaired. Net operating income of an income-producing property can be affected by, among other things: tenant mix, success of tenant businesses, occupancy rates, property management decisions, property location and condition, competition from comparable types of properties, changes in laws that increase operating expenses or limit rents that may be charged, any need to address environmental contamination at the property, the occurrence of any uninsured casualty at the property, changes in national, regional or local economic conditions and/or specific industry segments, declines in regional or local real estate values, declines in regional or local rental or occupancy rates, increases in interest rates, real estate tax rates and other operating expenses, changes in governmental rules, fiscal policies and regulations (including environmental legislation), natural disasters, terrorism, social unrest and civil disturbances.

In the event of any default under any mortgage loan held by us, we will bear a risk of loss of principal and accrued interest to the extent of any deficiency between the value of the collateral and the principal and accrued interest of the mortgage loan, which could have a material adverse effect on our cash flow from operations. Foreclosure on a property securing a mortgage loan can be an expensive and lengthy process that could have a substantial negative effect on our anticipated return on the foreclosed investment. In the event of the bankruptcy of a mortgage loan borrower, the mortgage loan to such borrower will be deemed to be secured only to the extent of the value of the underlying collateral at the time of bankruptcy (as determined by the bankruptcy court), and the lien securing the mortgage loan will be subject to the avoidance powers of the bankruptcy trustee or debtor-in-possession to the extent the lien is unenforceable under state law.

Delays in liquidating defaulted mortgage loans could reduce our investment returns.

If there are defaults under any mortgage loan we acquire or originate, we may not be able to repossess and sell the underlying properties quickly. The resulting time delay could reduce the value of our investment in the defaulted mortgage loans. An action to foreclose on a property securing a mortgage loan is regulated by state statutes and regulations and is subject to many of the delays and expenses of other lawsuits if the borrower raises defenses or counterclaims. In the event of default by a borrower, these restrictions, among other factors, may impede our ability to foreclose on or sell the mortgaged property or to obtain proceeds sufficient to repay all amounts due to us on the mortgage loan.

The mezzanine and bridge loans in which we may invest would involve greater risks of loss than loans secured by a first deed of trust or mortgage on property.

We may invest in mezzanine and bridge loans that take the form of subordinated loans secured by a pledge of the ownership interests of either the entity owning (directly or indirectly) the real property or the entity that owns the interest in the entity owning the real property. These types of investments may involve a higher degree of risk than long-term senior mortgage lending secured by income-producing real property because the investment may become unsecured as a result of foreclosure by the senior lender. In the event of a bankruptcy of the entity providing the pledge of its ownership interests as security, we may not have full recourse to the assets of such entity, or the assets of the entity may not be sufficient to satisfy our mezzanine loan. If a borrower defaults on our mezzanine loan or debt senior to our loan, or in the event of a borrower bankruptcy, our mezzanine loan will be satisfied only after the senior debt. As a result, we may not recover some or all of our investment. In addition, mezzanine loans may have higher loan-to-value ratios than conventional mortgage loans, resulting in less equity in the real property and increasing the risk of loss of principal.

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The B Notes in which we have invested and in which we may continue to invest may be subject to additional risks relating to the privately negotiated structure and terms of the transaction, which may result in losses to us.

We have invested in a B note and may continue to do so in the future. A B Note is a mortgage loan typically (i) secured by a first mortgage on a single large commercial property or group of related properties and (ii) subordinated to an A Note secured by the same first mortgage on the same collateral. As a result, if a borrower defaults, there may not be sufficient funds remaining for B Note holders after payment to the A Note holders. Since each transaction is privately negotiated, B Notes can vary in their structural characteristics and risks. For example, under the agreement between the A Note holders and the B Note holders, the A Note holders, whose economic interests may not align with the economic interests of the B Note holders, typically are empowered to take the lead on loan administration, on decisions whether to enforce or negotiate a work-out of a defaulted or stressed loan, and on pricing and market timing for the sale of foreclosed property. While the B Note holders can exercise some influence over those decisions through consent rights, the B Note holders typically lose their consent rights under certain circumstances, including if the liquidation value of the B Note, based on an appraisal, falls below an agreed threshold. We cannot predict the terms of each B Note investment. Further, B Notes typically are secured by a single property, and so reflect the increased risks associated with a single property compared to a pool of properties.

We expect to invest in real estate-related equity, which is subordinate to any indebtedness, but involves different rights.

We may invest from time to time in non-controlling equity positions and other real estate-related interests. Preferred equity investments are subordinate to any indebtedness obtained by the entity, but senior to the owners’ common equity. Preferred equity investments typically pay a dividend rather than interest payments and often have the right for such dividends to accrue if there is insufficient cash flow to pay currently. These interests are not secured by the underlying real estate, but upon the occurrence of a default, the preferred equity provider typically has the right to effectuate a change of control with respect to the ownership of the property.

We may invest in the preferred equity of other entities, the management of which may adversely affect our business.

We may invest in the preferred equity of other entities. However, we will not control the management, investment decisions, or operations of these companies. Management of those enterprises may decide to change the nature of their assets, or management may otherwise change in a manner that is not satisfactory to us. We will have no ability to affect these management decisions and we may have only limited ability to dispose of our investments.

Risks Associated with Debt Financing

We are likely to obtain mortgage indebtedness and other borrowings, which increases our risk of loss due to potential foreclosure.

We plan to obtain long-term financing that may be secured by our multifamily apartment communities. In some instances, we may acquire multifamily apartment communities by financing a portion of the price of the multifamily apartment communities and mortgaging or pledging some or all of the multifamily apartment communities purchased as security for that debt. We may also incur mortgage debt on multifamily apartment communities that we already own in order to obtain funds to acquire additional multifamily apartment communities, to fund property improvements and other capital expenditures, to make distributions, and for other purposes. In addition, we may borrow as necessary or advisable to ensure that we maintain our qualification as a REIT for federal income tax purposes, including borrowings to satisfy the REIT requirement that we distribute at least 90% of our annual REIT taxable income to our shareholders (computed without regard to the dividends-paid deduction and excluding net capital gain). We, however, can give our shareholders no assurance that we will be able to obtain such borrowings on satisfactory terms.

Incurring mortgage debt increases the risk of loss of a multifamily apartment community since defaults on indebtedness secured by a multifamily apartment community may result in lenders initiating foreclosure actions. In that case, we could lose the multifamily apartment community securing the loan that is in default, reducing the value of our shareholders’ investment. For tax purposes, a foreclosure of any of our multifamily apartment communities would be treated as a sale of the multifamily apartment community for a purchase price equal to the outstanding balance of the debt secured by the mortgage. If the outstanding balance of the debt secured by the mortgage exceeds

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our tax basis in the property, we would recognize taxable income on foreclosure even though we would not necessarily receive any cash proceeds. We may give full or partial guaranties to lenders of mortgage debt on behalf of the entities that own our multifamily apartment communities as well as with respect to debt associated with our preferred equity investments, mezzanine loans or equity investments in a property or land which will be developed into a multifamily apartment community. When we give a guaranty on behalf of an entity that owns one of our multifamily apartment communities or real estate-related assets, we will be responsible to the lender for satisfaction of the debt if it is not paid by such entity. If any mortgages contain cross-collateralization or cross-default provisions, a default on a single multifamily apartment community could affect many multifamily apartment communities.

Our multifamily apartment communities and multifamily real estate-related assets may be cross-collateralized.

We may obtain a line of credit or other debt financing which we may utilize to acquire multifamily apartment communities and multifamily real estate-related assets and fund our operations. Thus, our assets may be cross-collateralized. We have not obtained a commitment for the line of credit. Therefore, the amount and terms of the line of credit are uncertain and will be negotiated by our officers. No assurance can be given that future cash flow will be sufficient to make the debt service payments on any loans and to cover all operating expenses. If our revenues are insufficient to pay debt service and operating costs, we may be required to seek additional working capital. There can be no assurance that such additional funds will be available. The degree to which we are leveraged could have an adverse impact on us, including (i) increased vulnerability to adverse general economic and market conditions, (ii) impaired ability to expand and to respond to increased competition, (iii) impaired ability to obtain additional financing for future working capital, capital expenditures, general corporate or other purposes and (iv) requiring that a significant portion of cash provided by operating activities be used for the payment of debt obligations, thereby reducing funds available for operations and future business opportunities.

High mortgage rates or changes in underwriting standards may make it difficult for us to finance or refinance multifamily apartment communities, which could reduce the number of multifamily apartment communities we can acquire, our cash flows from operations and the amount of cash distributions we can make.

If mortgage debt is unavailable at reasonable rates, we may not be able to finance the purchase of multifamily apartment communities. If we place mortgage debt on a multifamily apartment community, we run the risk of being unable to refinance part or all of the multifamily apartment community when the debt becomes due or of being unable to refinance on favorable terms. If interest rates are higher when we refinance our multifamily apartment communities, our income could be reduced. We may be unable to refinance or may only be able to partly refinance our multifamily apartment communities if underwriting standards, including loan to value ratios and yield requirements, among other requirements, are stricter than when we originally financed the multifamily apartment communities. If any of these events occurs, our cash flow could be reduced and/or we might have to pay down existing mortgages. This, in turn, would reduce cash available for distribution to our shareholders, could cause us to require additional capital and may hinder our ability to raise capital by issuing more shares or by borrowing more money.

Lenders may require us to enter into restrictive covenants relating to our operations, which could limit our ability to make distributions to our shareholders.

When providing financing, a lender may impose restrictions on us that affect our distribution and operating policies and our ability to incur additional debt. Loan agreements we enter into may contain covenants that limit our ability to further mortgage a property or that prohibit us from discontinuing insurance coverage. These or other limitations would decrease our operating flexibility and our ability to achieve our operating objectives.

Increases in interest rates could increase the amount of our debt payments and limit our ability to make distributions to our shareholders.

We expect that we will incur debt in the future and increases in interest rates will increase the cost of that debt, which could reduce the cash we have available for distributions. Additionally, if we incur variable-rate debt, increases in interest rates would increase our interest costs, which would reduce our cash flows and our ability to make distributions to our shareholders. In addition, if we need to repay existing debt during periods of rising interest rates, we could be required to liquidate one or more of our investments at times that may not permit realization of the maximum return on such investments.

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We have broad authority to incur debt and high debt levels could hinder our ability to make distributions and decrease the value of our shareholders’ investment.

Our charter limits our leverage to 300% of our net assets, and we may exceed this limit with the approval of the conflicts committee of our board of directors. High debt levels would cause us to incur higher interest charges and higher debt service payments and may also be accompanied by restrictive covenants. These factors could limit the amount of cash we have available to distribute and could result in a decline in the value of our shareholders’ investment.

Interest-only indebtedness may increase our risk of default and ultimately may reduce our funds available for distribution to our shareholders.

We may obtain loans that require interest-only payments for a number of years before we are required to make payments on the principal. During the interest-only period, the amount of each scheduled payment will be less than that of a traditional amortizing mortgage loan. The principal balance of the mortgage loan will not be reduced (except in the case of prepayments) because there are no scheduled monthly payments of principal during this period. After the interest- only period, we will be required either to make scheduled payments of amortized principal and interest or to make a lump-sum, or “balloon,” payment at maturity. These required principal or balloon payments will increase the amount of our scheduled payments and may increase our risk of default under the related mortgage loan. If the mortgage loan has an adjustable interest rate, the amount of our scheduled payments also may increase at a time of rising interest rates. Increased payments and substantial principal or balloon maturity payments will reduce the funds available for distribution to our shareholders because cash otherwise available for distribution will be required to pay principal and interest associated with these mortgage loans.

We are uncertain of our sources for funding our future capital needs. If we do not have sufficient funds from operations to cover our expenses or to fund improvements to our multifamily apartment communities and cannot obtain debt or equity financing on acceptable terms, our ability to cover our expenses or to fund improvements to our multifamily apartment communities may be adversely affected.

The proceeds of this offering will be used primarily for investments in multifamily apartment communities and multifamily real estate-related assets. Until we have made substantial investments we do not expect to have sufficient funds from operations to cover all of our expenses. Accordingly, in the event that we develop a need for additional capital in the future for the improvement of our multifamily apartment communities or for any other reason, sources of funding may not be available to us. If we do not have sufficient funds from cash flow generated by our assets or out of net sale proceeds, or cannot obtain debt or equity financing on acceptable terms, our financial condition and ability to make distributions may be adversely affected.

The derivative financial instruments that we may use to hedge against interest rate fluctuations may not be successful in mitigating our risks associated with interest rates and could reduce the overall returns on your investment.

We may use derivative financial instruments, such as interest rate cap or collar agreements and interest rate swap agreements, to hedge exposures to changes in interest rates on loans secured by our assets, but no hedging strategy can protect us completely. These agreements involve risks, such as the risk that counterparties may fail to honor their obligations under these arrangements and that these arrangements may not be effective in reducing our exposure to interest rate changes. We cannot assure you that our hedging strategy and the derivatives that we use will adequately offset the risk of interest rate volatility or that our hedging transactions will not result in losses. In addition, the use of such instruments may reduce the overall return on our investments. These instruments may also generate income that may not be treated as qualifying REIT income for purposes of the 75% or 95% REIT gross income tests.

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We may not have sufficient funds to pay interest payments if the interest rates increase significantly.

It is anticipated that loans we obtain may have variable interest rates. In the event that the interest rate on any loan increases significantly, we may not have sufficient funds to pay the required interest payments. In such event, the continued ownership of the applicable multifamily apartment community may be threatened.

Federal Income Tax Risks

You may have current tax liability on distributions you elect to reinvest in our common stock.

If you participate in our distribution reinvestment plan, you will be deemed to have received, and for income tax purposes will be taxed on, the amount reinvested in shares of our common stock to the extent the amount reinvested was not a tax-free return of capital. In addition, you will be treated for tax purposes as having received an additional distribution to the extent the shares are purchased at a discount to fair market value. As a result, unless you are a tax-exempt entity, you may have to use funds from other sources to pay your tax liability on the value of the shares of common stock received. See “Description of Shares – Distribution Reinvestment Plan – Tax Consequences of Participation.”

Failure to qualify as a REIT would reduce our net earnings available for investment or distribution.

Our qualification as a REIT will depend upon our ability to meet requirements regarding our organization and ownership, distributions of our income, the nature and diversification of our income and assets, and other tests imposed by the Internal Revenue Code. If we fail to qualify as a REIT for any taxable year after electing REIT status, we will be subject to federal income tax on our taxable income at corporate rates. In addition, we would generally be disqualified from treatment as a REIT for the four taxable years following the year of losing our REIT status. Losing our REIT status would reduce our net earnings available for investment or distribution to shareholders because of the additional tax liability. In addition, distributions to shareholders would no longer qualify for the dividends-paid deduction and we would no longer be required to make distributions. If this occurs, we might be required to borrow funds or liquidate some investments in order to pay the applicable tax. For a discussion of the REIT qualification tests and other considerations relating to our election to be taxed as a REIT, see “Federal Income Tax Considerations.”

Even if we qualify as a REIT for federal income tax purposes, we may be subject to other tax liabilities that reduce our cash flow and our ability to make distributions to our shareholders.

Even if we qualify as a REIT for federal income tax purposes, we may be subject to some federal, state and local taxes on our income or property. For example:

• In order to qualify as a REIT, we must distribute annually at least 90% of our REIT taxable income to our shareholders (which is determined without regard to the dividends-paid deduction or net capital gain). To the extent that we satisfy the distribution requirement but distribute less than 100% of our REIT taxable income, we will generally be subject to federal corporate income tax on the undistributed income.

• We will be subject to a 4% nondeductible excise tax on the amount, if any, by which distributions we pay in any calendar year are less than the sum of 85% of our ordinary income, 95% of our capital gain net income, and 100% of our undistributed income from prior years.

• If we have net income from the sale of foreclosure property that we hold primarily for sale to customers in the ordinary course of business or other non-qualifying income from foreclosure property, we must pay a tax on that income at the highest corporate income tax rate.

• If we sell an asset, other than foreclosure property, that we hold primarily for sale to customers in the ordinary course of business, our gain would be subject to the 100% “prohibited transaction” tax unless such sale were made by one of our taxable REIT subsidiaries or we qualified for a “safe harbor” under the Internal Revenue Code.

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We intend to make distributions to our shareholders to comply with the REIT requirements of the Internal Revenue Code.

The ownership limits that apply to REITs, as prescribed by the Internal Revenue Code and by our charter, may inhibit market activity in shares of our common stock and restrict our business combination opportunities.

In order for us to qualify as a REIT, not more than 50% in value of our outstanding shares of stock may be owned, directly or indirectly, by five or fewer individuals (as defined in the Internal Revenue Code to include certain entities) at any time during the last half of each taxable year after the first year for which we elect to qualify as a REIT. Additionally, at least 100 persons must beneficially own our stock during at least 335 days of a taxable year (other than the first taxable year for which we elect to be taxed as a REIT). Our charter, with certain exceptions, authorizes our directors to take such actions as are necessary and desirable to preserve our qualification as a REIT. Our charter also provides that, unless exempted by our board of directors, no person may own more than 9.8% by value or number of shares, whichever is more restrictive, of our outstanding shares of common stock, or 9.8% by value or number of shares, whichever is more restrictive, of our outstanding capital stock. Our board of directors may, in its sole discretion, subject to such conditions as it may determine and the receipt of certain representations and undertakings, prospectively or retroactively, waive the ownership limit or establish a different limit on ownership, or excepted holder limit, for a particular shareholder if the shareholder’s ownership in excess of the ownership limit would not result in our being “closely held” under Section 856(h) of the Internal Revenue Code or otherwise failing to qualify as a REIT. These ownership limits could delay or prevent a transaction or a change in control of our company that might involve a premium price for our shares of common stock or otherwise be in the best interest of our shareholders.

REIT distribution requirements could adversely affect our ability to execute our business plan.

To qualify as a REIT, we must distribute to our shareholders each year 90% of our REIT taxable income (which is determined without regard to the dividends-paid deduction or net capital gain). From time to time, we may generate taxable income greater than our income for financial reporting purposes, or our taxable income may be greater than our cash flow available for distribution to shareholders (for example, where a borrower defers the payment of interest in cash pursuant to a contractual right or otherwise). If we do not have other funds available in these situations we could be required to borrow funds, sell investments at disadvantageous prices, or find another alternative source of funds to make distributions sufficient to enable us to pay out enough of our taxable income to satisfy the REIT distribution requirement and to avoid corporate income tax and the 4% excise tax in a particular year. These alternatives could increase our costs or reduce our equity. Thus, compliance with the REIT requirements may hinder our ability to operate solely on the basis of maximizing profits.

To maintain our REIT status, we may be forced to forego otherwise attractive opportunities, which may delay or hinder our ability to meet our investment objectives and reduce our shareholders’ overall return.

To qualify as a REIT, we must satisfy certain tests on an ongoing basis concerning, among other things, the sources of our income, nature of our assets, and the amounts we distribute to our shareholders. We may be required to make distributions to shareholders at times when it would be more advantageous to reinvest cash in our business or when we do not have funds readily available for distribution. Compliance with the REIT requirements may hinder our ability to operate solely on the basis of maximizing profits and the value of our shareholders’ investment.

The tax on prohibited transactions will limit our ability to engage in transactions that would be treated as sales for federal income tax purposes.

A REIT’s net income from prohibited transactions is subject to a 100% tax. In general, prohibited transactions are sales or other dispositions of assets, other than foreclosure property, deemed held primarily for sale to customers in the ordinary course of business (subject to a safe harbor under the Internal Revenue Code for certain sales). It may be possible to reduce the impact of the prohibited transaction tax by conducting certain activities through taxable REIT subsidiaries. However, to the extent that we engage in such activities through taxable REIT subsidiaries, the income associated with such activities may be subject to full corporate income tax.

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The failure of a mezzanine loan to qualify as a real estate asset could adversely affect our ability to qualify as a REIT.

We may make mezzanine loans. The Internal Revenue Service has provided a safe harbor in Revenue Procedure 2003-65 for structuring mezzanine loans so that they will be treated by the Internal Revenue Service as a real estate asset for purposes of the REIT asset tests, and interest derived from mezzanine loans will be treated as qualifying mortgage interest for purposes of the 75% gross income test, as discussed below. Although the Revenue Procedure provides a safe harbor on which taxpayers may rely, it does not prescribe rules of substantive tax law. We may make mezzanine loans that do not meet all of the requirements of the safe harbor. In the event a mezzanine loan does not meet the safe harbor, the Internal Revenue Service could challenge such loan’s treatment as a real estate asset for purposes of the REIT asset and income tests and, if such a challenge were sustained, we could fail to continue to qualify as a REIT.

Non-United States investors may be subject to FIRPTA on the sale of shares of our common stock if we are unable to qualify as a “domestically controlled qualified investment entity.”

A non-United States person disposing of a United States real property interest, including shares of a United States corporation whose assets consist principally of United States real property interests, is generally subject to a tax, known as FIRPTA, on the gain recognized on the disposition of such interest. Certain “qualified foreign pension funds” and certain “qualified shareholders” are exempt from FIRPTA. FIRPTA does not apply, however, to the disposition of shares in a REIT if the REIT is a “domestically controlled qualified investment entity.” A REIT is a domestically controlled qualified investment entity if, at all times during a specified testing period (the continuous five year period ending on the date of disposition or, if shorter, the entire period of the REIT’s existence), less than 50% in value of its shares is held directly or indirectly by non-United States holders. We cannot assure you that we will qualify as a domestically controlled qualified investment entity. If we were to fail to so qualify, gain realized by a non-United States investor on a sale of our common stock would be subject to FIRPTA unless our common stock was traded on an established securities market and the non-United States investor did not at any time during a specified testing period directly or indirectly own more than 10% of the value of our outstanding common stock.

Complying with REIT requirements may limit our ability to hedge effectively.

The REIT provisions of the Internal Revenue Code may limit our ability to hedge our assets and operations. Under these provisions, any income that we generate from transactions intended to hedge our interest rate, inflation and/or currency risks, including gain from the disposition of certain hedging transactions, will be excluded from gross income for purposes of the REIT 75% and 95% gross income tests if the instrument hedges (i) interest rate risk on liabilities incurred to carry or acquire real estate, (ii) risk of currency fluctuations with respect to any item of income or gain that would be qualifying income under the REIT 75% or 95% gross income tests or (iii) risks associated with the extinguishment of certain indebtedness or the disposition of certain property related to prior hedging transactions described in (i) or (ii) above and each such instrument is properly identified under applicable Treasury Regulations. Income from hedging transactions that do not meet these requirements will generally constitute nonqualifying income for purposes of both the REIT 75% and 95% gross income tests. As a result of these rules, we may have to limit our use of hedging techniques that might otherwise be advantageous, which could result in greater risks associated with interest rate or other changes than we would otherwise incur.

Equity participation in mortgage, bridge and mezzanine loans may result in taxable income and gains from these properties, which could adversely impact our REIT status.

If we participate under a loan in any appreciation of the properties securing the loan or its cash flow and the Internal Revenue Service characterizes this participation as “equity,” we might have to recognize income, gains and other items from the property for federal income tax purposes. This could affect our ability to qualify as a REIT.

Your investment has various federal income tax risks.

Although the provisions of the Internal Revenue Code generally relevant to an investment in shares of our common stock are described in “Federal Income Tax Considerations,” we urge you to consult your tax advisor concerning the effects of United States federal, state, local and foreign tax laws to you with regard to an investment in shares of our common stock.

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Retirement Plan Risks

If the fiduciary of an employee pension benefit plan subject to ERISA (such as profit sharing, Section 401(k) or pension plan) or any other retirement plan or account fails to meet the fiduciary and other standards under ERISA or the Internal Revenue Code as a result of an investment in our common stock, the fiduciary could be subject to criminal and civil penalties.

There are special considerations that apply to employee benefit plans subject to ERISA (such as profit sharing, Section 401(k) or pension plans) and other retirement plans or accounts subject to Section 4975 of the Internal Revenue Code (such as an IRA) that are investing in our shares. Fiduciaries investing the assets of such a plan or account in our common stock should satisfy themselves that:

• the investment is consistent with their fiduciary and other obligations under ERISA and the Internal Revenue Code;

• the investment is made in accordance with the documents and instruments governing the plan or IRA, including the plan’s or account’s investment policy;

• the investment satisfies the prudence and diversification requirements of Sections 404(a)(1)(B) and 404(a)(1)(C) of ERISA and other applicable provisions of ERISA and the Internal Revenue Code;

• the investment in our shares, for which no public market currently exists, is consistent with the liquidity needs of the plan or IRA;

• the investment will not produce an unacceptable amount of “unrelated business taxable income” for the plan or IRA;

• our shareholders will be able to comply with the requirements under ERISA and the Internal Revenue Code to value the assets of the plan or IRA annually; and

• the investment will not constitute a prohibited transaction under Section 406 of ERISA or Section 4975 of the Internal Revenue Code.

With respect to the annual valuation requirements described above, we will provide an estimated value for our shares annually. We can make no claim whether such estimated value will or will not satisfy the applicable annual valuation requirements under ERISA and the Internal Revenue Code. The Department of Labor or the Internal Revenue Service may determine that a plan fiduciary or an IRA custodian is required to take further steps to determine the value of our common shares. In the absence of an appropriate determination of value, a plan fiduciary or an IRA custodian may be subject to damages, penalties or other sanctions.

Failure to satisfy the fiduciary standards of conduct and other applicable requirements of ERISA and the Internal Revenue Code may result in the imposition of civil and criminal penalties and could subject the fiduciary to claims for damages or for equitable remedies. In addition, if an investment in our shares constitutes a prohibited transaction under ERISA or the Internal Revenue Code, the fiduciary or IRA owner who authorized or directed the investment may be subject to the imposition of excise taxes with respect to the amount invested. In the case of a prohibited transaction involving an IRA owner, the IRA may be disqualified and all of the assets of the IRA may be deemed distributed and subjected to tax. ERISA plan fiduciaries and IRA custodians should consult with counsel before making an investment in our common shares.

Certain proposed federal and state regulations, if any or all of them become applicable, could adversely affect the marketing of our shares.

On April 18, 2018, the SEC proposed “Regulation Best Interest,” a new standard of conduct for broker-dealers under the Exchange Act, which would require a broker-dealer to act in the best interest of a retail customer, including participants in ERISA-covered plans and IRAs, when making a recommendation of any securities transaction, without putting its financial interests ahead of the interests of a retail customer. The proposed rule

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includes guidance on what constitutes a “recommendation” and a definition of who would be a “retail customer” in addition to provisions setting forth certain required disclosures, policies and procedures to identify conflicts of interest, and customer-specific best interest obligations. A 90-day comment period began upon official publication of the proposal.

In addition to the SEC proposed rules, several states, including Connecticut, Nevada, New Jersey and New York, have passed laws or proposed regulations requiring investment advisers, broker-dealers and/or agents to disclose conflicts of interest to clients or to meet standards that their advice be in the customer’s best interest. These recent developments could result in additional requirements imposed on such persons related to the marketing of our shares.

While we continue to monitor and evaluate the various proposals, we cannot predict what other proposals may be made, what legislation or regulation may be introduced or become law. Therefore, until such time as final rules or laws are in place, the potential impact on the marketing of our shares through the impacted channels is uncertain.

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CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS

This prospectus contains forward-looking statements about our business, including, in particular, statements about our plans, strategies and objectives. You can generally identify forward-looking statements by our use of forward-looking terminology such as “may,” “will,” “expect,” “intend,” “anticipate,” “estimate,” “believe,” “continue,” or other similar words. You should not rely on these forward-looking statements because the matters they describe are subject to known and unknown risks, uncertainties and other unpredictable factors, many of which are beyond our control. Our actual results, performance and achievements may be materially different from those expressed or implied by these forward-looking statements.

You should carefully review the “Risk Factors” section of this prospectus for a discussion of the risks and uncertainties that we believe are material to our business, operating results, prospects and financial condition. Except as otherwise required by federal securities laws, we do not undertake to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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PLAN OF DISTRIBUTION

General

We are publicly offering a maximum of $750,000,000 of shares of our Class A and Class T common stock on a “best-efforts” basis through Orchard Securities, LLC, our dealer manager. Because this is a “best-efforts” offering, Orchard Securities, LLC must use only its best efforts to sell the shares and has no firm commitment or obligation to purchase any of our shares. We are offering up to $675,000,000 of shares of our Class A and Class T common stock in our primary offering at $10.00 per share. We are also offering up to $75,000,000 of shares of our Class A and Class T common stock pursuant to our distribution reinvestment plan. Shares sold pursuant to our distribution reinvestment plan are sold at a price of $10.00 per share. Once we establish an NAV per share, shares issued pursuant to our distribution reinvestment plan will be priced at the NAV per share of our common stock, as determined by our board. Purchases pursuant to our distribution reinvestment plan will be in the same class of shares as the share for which such shareholder received the distributions that are being reinvested. We reserve the right to reallocate shares of our common stock between our distribution reinvestment plan offering and our primary offering. We are offering to sell any combination of two classes of shares of our common stock, Class A shares and Class T shares, with a dollar value up to the maximum offering amount. The share classes have different selling commission structures. Any offering-related expenses are paid by our advisor without reimbursement by us and thus these different fees have no impact on our shareholders. Our board of directors may adjust the offering price of this offering during the course of the offering. Any adjustment to the offering price of less than 20% would be effected by a supplement to this prospectus. A larger adjustment could only be effected by means of a post-effective amendment.

We expect to offer shares in this offering until August 13, 2020. If we have not sold all of the primary offering shares on or before August 13, 2020, we may continue this offering until August 13, 2021 (unless extended as permitted by applicable securities laws). Under rules promulgated by the SEC, if we have filed a registration statement relating to a follow-on offering, we could continue our primary offering until such follow-on offering registration has been declared effective. If we decided to continue our primary offering beyond August 13, 2020, we will provide that information in a prospectus supplement. In many states, we will need to renew the registration statement or file a new registration statement to continue the offering beyond one year form the date of this prospectus. We may terminate this offering at any time. We may continue to offer shares under our distribution reinvestment plan beyond these dates until we have sold $75,000,000 of shares through the reinvestment of distributions.

Compensation of Dealer Manager and Soliciting Dealers

Upfront Selling Commissions and Dealer Manager Fees

Our advisor pays the dealer manager selling commissions of up to 6% and up to 3% of the gross primary offering proceeds from the sale of our Class A and Class T common stock, respectively. The dealer manager may authorize certain other broker-dealers who are members of FINRA, who we refer to as soliciting dealers, to sell our shares. In the event of the sale of shares by soliciting dealers, the dealer manager re-allows all of its selling commissions to the soliciting dealers.

For both classes of shares, our advisor also pays the dealer manager a dealer manager fee up to 3% of the gross primary offering proceeds as compensation for acting as the dealer manager and for expenses incurred in connection with marketing our shares and wholesaler compensation. Of this dealer manager fee, Orchard Securities, LLC pays up to 1.35% of the gross proceeds from the primary offering to certain wholesalers that may be employees of Cottonwood Residential II, Inc. or Cottonwood Residential O.P., LP. In addition, from this dealer manager fee, Orchard Securities, LLC re-allows 1.00% of the gross proceeds from the primary offering to soliciting dealers as a non-accountable marketing and due diligence allowance, and in select cases up to 1.25% of the gross proceeds from the primary offering will be reallowed. In circumstances where 1.00% of offering proceeds are reallowed, the dealer manager fee will be 2.75%. The maximum amount of reimbursements would be based on factors such as the number of shares sold by soliciting dealers, the assistance of such soliciting dealers in marketing the offering, and due diligence expenses incurred.

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Deferred Selling Commissions

Subject to FINRA limitations on underwriting compensation and certain other limitations described below, our advisor pays the dealer manager a deferred selling commission with respect to our outstanding Class T shares sold in the primary offering equal to 1.0% per annum of the estimated value per share for the Class T share for three years from the date on which such share is issued.

The deferred selling commission will accrue daily based on the number of Class T shares outstanding on each day that were sold in the primary offering within the previous three years of such date and be paid monthly in arrears. The dealer manager will reallow all of the deferred selling commissions to participating broker-dealers and servicing broker-dealers as described below. Class T shares purchased pursuant to our distribution reinvestment plan or received as a stock dividend are not subject to a deferred selling commission. Because our advisor has agreed to pay the deferred selling commissions and other underwriting compensation on our behalf without reimbursement by us, the deferred selling commission will have no impact on us or on holders of our Class T shares.

Eligibility to receive the deferred selling commission with respect to any Class T share is conditioned on a broker-dealer acting as the broker-dealer of record or acting as a servicing broker-dealer with respect to such share. If the applicable broker-dealer is not eligible to receive the deferred selling commission, the dealer manager will rebate to our advisor the deferred selling commission that such broker-dealer would have otherwise been eligible to receive. The deferred selling commissions are ongoing fees that are not paid at the time of purchase.

Payment of the deferred selling commissions with respect to individual Class T shares will cease when they are no longer outstanding, including as a result of conversion to Class A shares and redemption or repurchase. Each Class T share held in a shareholder’s account shall automatically and without any action on the part of the holder thereof convert into a Class A share, on the earliest to occur of the following: (i) a listing of the Class A shares on a national securities exchange; (ii) a merger or consolidation of our company with or into another entity, or the sale or other disposition of all or substantially all of our assets; and (iii) the last calendar day of the month in which we and our dealer manager, in conjunction with our transfer agent, determine that the deferred selling commission paid with respect to the Class T shares held by such shareholder within such account equals or exceeds three percent of the aggregate gross purchase price of the Class T shares held by such shareholder within such account and purchased in a primary offering. In addition, after termination of a primary offering registered under the Securities Act, payment of the deferred selling commission will cease with respect to each Class T share sold in that primary offering, on the date when we, with the assistance of our dealer manager, determine that all underwriting compensation paid or incurred with respect to the primary offering covered by that registration statement from all sources, determined pursuant to the rules and guidance of FINRA, would be in excess of 10% of the aggregate purchase price of all shares sold for our account through that primary offering. Further, each Class T share sold in that primary offering, each Class T share sold under a distribution reinvestment plan pursuant to the same registration statement that was used for that primary offering, and each Class T share received as a stock dividend with respect to such shares sold in such primary offering or distribution reinvestment plan shall automatically and without any action on the part of the holder thereof convert into a Class A share at the last calendar day of the month in which such determination is made. We cannot predict if or when certain of the foregoing events will occur. If we redeem a portion, but not all of the Class T shares held in a shareholder’s account, the underwriting compensation limit and amount of underwriting compensation previously paid will be prorated between the Class T shares that were redeemed and those Class T shares that were retained in the account. Likewise, if a portion of the Class T shares in a shareholder’s account is sold or otherwise transferred in a secondary transaction, the total underwriting compensation limit and amount of underwriting compensation previously paid will be prorated between the Class T shares that were transferred and the Class T shares that were retained in the account.

With respect to the conversion of Class T shares into Class A shares, each Class T share will convert without any action on the part of the holder thereof into a number of Class A shares equal to such Class T share multiplied by a fraction, the numerator of which is the most recent NAV per Class T share and the denominator of which is the most recent NAV per Class A share. Shareholders will receive notice that their Class T shares have been converted into Class A shares in accordance with industry practice at that time, which we expect to be either a transaction confirmation from the transfer agent, notification from the transfer agent or notification through the next account statement following the conversion. We currently expect that the conversion of each Class T share will be on a one-for-on basis, as we expect the NAV per share of each Class A share and Class T share will be the same as there are currently no class-specific expenses associated with the different share classes.

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Neither we nor our advisor will pay referral or similar fees to any accountants, attorneys, or other persons in connection with the distribution of the shares. We are not responsible for paying any selling commissions or dealer manager fees. The maximum amount of non-transaction based items of compensation to be paid in connection with this offering, including, but not limited to the non-transaction based compensation allocated to dual-employees, will not exceed 1% of the gross primary offering proceeds. No dealer manager fees or selling commissions are payable for shares sold pursuant to our distribution reinvestment plan.

Purchase Price Discounts

We sell Class A shares at a discount to the primary offering price of $10.00 per share through the following distribution channels in the event that the investor:

• pays a broker a single fee, e.g., a percentage of assets under management, for investment advisory and broker services, which is frequently referred to as a “wrap fee”;

• has engaged the services of a registered investment advisor with whom the investor has agreed to pay compensation for investment advisory services or other financial or investment advice (other than a registered investment advisor that is also registered as a broker-dealer who does not have a fixed or “wrap fee” feature or other asset fee arrangement with the investor); or

• is investing through a bank acting as trustee or fiduciary.

If an investor purchases Class A shares through one of these channels in our primary offering, we will sell the Class A shares at a 6.0% discount, or at $9.40 per share, reflecting that selling commissions are not paid in connection with such purchases. To ensure that we receive proceeds equivalent to those received for sales of Class A shares outside these channels our advisor has agreed to waive its asset management each month in an amount equivalent to the 6.0% discount provided to such purchasers in that month. Because of the commission structure for Class T shares, we do not expect sales of our Class T shares to be made through the above distribution channels and therefore these purchase price discounts are not available for Class T share purchases.

If an investor purchases Class A shares in our primary offering net of commissions through a registered investment advisor that is affiliated with a soliciting dealer in a transaction in which the registered investment advisor is compensated on a fee-for-service basis by the investor, the dealer manager may reallow to the affiliated soliciting dealer up to 1% of the gross offering proceeds attributable to that transaction as a marketing fee, or up to 1.25% in select cases as described above. The marketing fee paid to soliciting dealers would be paid by the dealer manager out of its dealer manager fee. If an investor purchases shares in the offering through a registered investment advisor (or bank acting as a trustee or fiduciary) not affiliated with a soliciting dealer, the registered investment adviser may not receive any portion of the dealer manager fee. Neither the dealer manager nor its affiliates compensates any person engaged (or bank acting as a trustee or fiduciary) as an investment advisor by a potential investor as an inducement for such investment advisor to advise favorably for an investment in us.

Total Underwriting Compensation

The table and discussion below sets forth the nature and estimated amount of all items viewed as “underwriting compensation” by FINRA, assuming we sell all $675,000,000 of common stock offered in this primary offering, The maximum selling commissions assumes that 85% and 15% of the gross proceeds raised in the primary offering is from the sale of Class A and Class T shares of common stock, respectively. As we are registering any combination of the two classes, this allocation is management’s best estimate based on the recommendation of our dealer manager and its perceived demand in the market for each respective class of shares.

	Total Compensation(1)
Upfront Selling commissions (maximum)	$	37,462,500
Dealer manager fee (maximum)	$	20,250,000
Deferred selling commission (maximum)	$	3,037,500
Total	$	60,750,000

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(1) We are not responsible for paying any upfront or deferred selling commissions or dealer manager fees to the dealer manager. Our advisor, CC Advisors III, LLC, is responsible for paying the dealer manager fees and upfront and deferred selling commissions on our behalf without reimbursement from us.

Under the rules of FINRA, total underwriting compensation in this offering, including selling commissions, the dealer manager fee and any additional expense reimbursements to our dealer manager and soliciting dealers (excluding bona fide invoiced due diligence expenses), may not exceed 10% of our gross offering proceeds from our primary offering. In addition to the limits on underwriting compensation, FINRA and many states also limit our total organization and offering expenses to 15% of gross offering proceeds.

To the extent permitted by law and our charter, we indemnify the soliciting dealers and the dealer manager against some civil liabilities, including certain liabilities under the Securities Act of 1933, as amended (the “Securities Act”), and liabilities arising from breaches of our representations and warranties contained in the dealer manager agreement. See “Management — Limited Liability and Indemnification of Directors, Officers, Employees and Other Agents.”

Subscription Procedures

To purchase shares in this offering, you must complete and sign a subscription agreement (in the form attached to this prospectus as Appendix A) for a specific investment amount and class of shares and pay for the shares at the time of your subscription. You should make your check payable to “Cottonwood Communities, Inc.” Completed subscription agreements and payments should be sent by your broker-dealer or registered investment advisor, as applicable, to us at the address set forth in the subscription agreement. Subscriptions will be effective only upon our acceptance, and we reserve the right to reject any subscription in whole or in part for any reason in our discretion, including a failure to adequately complete all of the required items in the subscription agreement or failure to provide any additional documentation needed to support information in the subscription agreement. We generally expect to admit shareholders on a daily basis. We will have a period of 30 days after receipt of each subscription agreement to accept or reject the subscription agreement. If rejected, we will return all funds to the rejected subscribers within ten business days. If accepted, the funds will be transferred into our general account. You will receive a confirmation of your purchase.

You are required to represent in the subscription agreement that you have received a copy of the final prospectus. In order to ensure that you have had sufficient time to review the final prospectus, we will not accept your subscription until at least five business days after your receipt of the final prospectus.

Suitability Standards

Those selling shares on our behalf and participating soliciting dealers and registered investment advisors recommending the purchase of shares in this offering have the responsibility to make every reasonable effort to determine that your purchase of shares in this offering is a suitable and appropriate investment for you based on information provided by you regarding your financial situation and investment objectives. In making this determination, these persons have the responsibility to ascertain that you:

• meet the minimum income and net worth standards set forth under “Suitability Standards” immediately following the cover page of this prospectus;

• can reasonably benefit from an investment in our shares based on your overall investment objectives and portfolio structure;

• are able to bear the economic risk of the investment based on your overall financial situation;

• are in a financial position appropriate to enable you to realize to a significant extent the benefits described in this prospectus of an investment in our shares; and

• have apparent understanding of:

• the fundamental risks of the investment;

• the risk that you may lose your entire investment;

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• the lack of liquidity of our shares;

• the restrictions on transferability of our shares; and

• the tax consequences of your investment.

Relevant information for this purpose will include at least your age, investment objectives, investment experience, income, net worth, financial situation, and other investments as well as any other pertinent factors. The soliciting dealers and registered investment advisors recommending the purchase of shares in this offering must maintain, for a six-year period, records of the information used to determine that an investment in shares is suitable and appropriate for you.

Minimum Purchase Requirements

You must initially invest at least $5,000 in our shares to be eligible to participate in this offering. In order to satisfy this minimum purchase requirement, unless otherwise prohibited by state law, a husband and wife may jointly contribute funds from their separate IRAs, provided that each such contribution is made in increments of $100. You should note that an investment in our shares will not, in itself, create a retirement plan and that, in order to create a retirement plan, you must comply with all applicable provisions of the Internal Revenue Code.

If you have satisfied the applicable minimum purchase requirement, any additional purchase must be in amounts of at least $100.

Unless you are transferring all of your shares, you may not transfer your shares in a manner that causes you or your transferee to own fewer than the number of shares required to meet the minimum purchase requirements, except for the following transfers without consideration: transfers by gift, transfers by inheritance, intrafamily transfers, family dissolutions, transfers to affiliates and transfers by operation of law.

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ESTIMATED USE OF PROCEEDS

The following table sets forth information about how we intend to use the proceeds raised in this offering assuming that we sell the maximum offering of $675,000,000 of shares of our Class A and Class T common stock in our primary offering. We are offering to sell any combination of two classes of shares of our common stock, Class A shares and Class T shares, with a dollar value up to the maximum offering amount. The share classes have different selling commission structures. Any offering-related expenses are paid by our advisor without reimbursement by us. We are also offering $75,000,000 of shares pursuant to our distribution reinvestment plan. For purposes of this table, we have assumed that no shares will be sold pursuant to our distribution reinvestment plan and we do not reallocate shares being offered between the primary and the distribution reinvestment plan offering. In addition, we have assumed that 85% and 15% of the gross proceeds raised in the primary offering is from the sale of Class A and Class T shares of common stock, respectively. Many of the amounts set forth below represent management’s best estimate since they cannot be precisely calculated at this time. We estimate that we will use 100% of the gross proceeds from this offering, or $10.00 per share, for investments in multifamily apartment communities and multifamily real estate-related assets.

To the extent offering proceeds are used to pay distributions in anticipation of future cash flow from operating activities, the amount available for investment will be correspondingly reduced, your overall return may be reduced, our portfolio may be less diversified and the value of a share of our common stock may be diluted. Our organizational documents do not limit the amount of distributions we can fund from sources other than from cash flows from operations, including from offering proceeds. See “Risk Factors – Risks Related to This Offering and Our Corporate Structure.”

	Maximum Offering of $675,000,000(1)
Gross Offering Proceeds	$	675,000,000		100.0	%
Upfront Selling Commissions(1)	$	37,462,500		5.55	%
Deferred Selling Commission(1)(2)	$	3,037,500		0.45	%
Dealer Manager Fees(2)	$	20,250,000		3.0	%
Organizational and Offering Expenses(2)	$	6,750,000		1.0	%
Selling Commissions, Dealer Manager Fees and Organizational and Offering Expenses paid by Sponsor(2)	$	(67,500,000	)	(10.0	%)
Amount Available for Investment/Net Investment Amount(3)	$	675,000,000		100.0	%

(1) As we are registering any combination of the two classes of shares, this allocation is management’s best estimate based on the recommendation of our dealer manager and its perceived demand in the market for each respective class of shares. If the demand for the Class A and Class T shares varies materially from our assumptions as of the date of this prospectus, the amount of selling commissions will be altered from the amounts set forth above.

(2) Pursuant to the Three-Party Agreement, our advisor has agreed to pay all upfront and deferred selling commissions, dealer manager fees, and any organizational and offering expenses on our behalf, without reimbursement by us. From our advisor, Orchard Securities, LLC receives a selling commission in an amount up to 6% and up to 3% of gross primary offering proceeds, with respect to our shares of Class A and Class T common stock, respectively, which amounts will be re-allowed to the soliciting dealer. In addition, our advisor pays Orchard Securities, LLC a dealer manager fee up to 3% of gross primary offering proceeds for acting as the dealer manager and for expenses incurred in connection with marketing our shares and wholesaler compensation. From the dealer manager fee, Orchard Securities, LLC pays up to 1.35% of gross primary offering proceeds to certain wholesalers that may be employees of Cottonwood Residential II, Inc. or Cottonwood Residential O.P., LP. The dealer manager may re-allow part of the dealer manager fee to soliciting dealers. Our advisor also pays our organizational and offering expenses, including our legal, accounting, printing, mailing and filing fees, charges of our escrow holder and transfer agent on our behalf without reimbursement by us. We expect organizational and offering expenses (other than upfront and deferred selling commissions and the dealer manager fee) to be approximately 1% of the gross proceeds from the offering if we raise the maximum offering amount. Our organizational documents permit us to make distributions from any source, including offering proceeds or borrowings (which may constitute a return of capital), and our organizational documents do not limit the amount from any source to pay such distributions. If we make distributions from sources other than our cash flow from operations, we will have less funds available for investment in multifamily apartment communities or multifamily real estate-related assets. If we terminate our advisory agreement, our advisor may be motivated to terminate its participation in the Three-Party Agreement that obligates our advisor to pay upfront and deferred selling commissions, dealer manager fees and organization and offering expenses on our behalf without reimbursement by us. If our advisor ceases to pay our offering expenses, we may be forced to terminate this offering.

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Except as described in the “Plan of Distribution” section of this prospectus, a deferred selling commission of 1.0% of the estimated value per share for each Class T share sold in the primary offering will be paid to our dealer manager and will accrue daily and be paid monthly in arrears. Our dealer manager will reallow all of the deferred selling commission paid to it.

Payment of the deferred selling commissions with respect to individual Class T shares will cease when they are no longer outstanding, including as a result of conversion to Class A shares and redemption or repurchase. Each Class T share held in a shareholder’s account shall automatically and without any action on the part of the holder thereof convert into a Class A share, on the earliest to occur of the following: (i) a listing of the Class A shares on a national securities exchange; (ii) a merger or consolidation of our company with or into another entity, or the sale or other disposition of all or substantially all of our assets; and (iii) the last calendar day of the month in which we and our dealer manager, in conjunction with our transfer agent, determine that the deferred selling commission paid with respect to the Class T shares held by such shareholder within such account equals or exceeds three percent of the aggregate gross purchase price of the Class T shares held by such shareholder within such account and purchased in a primary offering. In addition, after termination of a primary offering registered under the Securities Act, payment of the deferred selling commission with respect to each Class T share sold in that primary offering will cease, on the date when we, with the assistance of our dealer manager, determine that all underwriting compensation paid or incurred with respect to the primary offering covered by that registration statement from all sources, determined pursuant to the rules and guidance of FINRA, would be in excess of 10% of the aggregate purchase price of all shares sold for our account through that primary offering. Further, each Class T share sold in that primary offering, each Class T share sold under a distribution reinvestment plan pursuant to the same registration statement that was used for that primary offering, and each Class T share received as a stock dividend with respect to such shares sold in such primary offering or distribution reinvestment plan shall automatically and without any action on the part of the holder thereof convert into a Class A share at the last calendar day of the month in which such determination is made.

Our advisor is paying all upfront and deferred selling commissions, dealer manager fees, and all organizational and offering expenses on our behalf without reimbursement by us. Our advisor and its affiliates have entered into certain contracts with us such as the advisory agreement, and receive certain fees pursuant to those contracts. See “Management Compensation” for more information regarding the fees payable pursuant to such contracts. If our advisor did not agree to pay the upfront and deferred selling commissions, dealer manager fees, and organizational and offering expenses on our behalf, the terms of the contracts between us and our advisor may have been more advantageous to us. Potential investors should consult their investment advisors.

(3) Until required in connection with investment in multifamily apartment communities or multifamily real estate-related assets, substantially all of the proceeds of the offering and, thereafter, our working capital reserves, may be invested in short-term, highly liquid investments, including government obligations, bank certificates of deposit, short-term debt obligations and interest-bearing accounts or other authorized investments as determined by our board of directors. Amounts available for investment from this offering may also include anticipated capital improvement expenditures and leasing costs.

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MANAGEMENT

Board of Directors

We operate under the direction of our board of directors, the members of which are accountable to us and our shareholders as fiduciaries. The board of directors is responsible for the management and control of our affairs and oversight of service providers at all times. The board of directors has retained our advisor, CC Advisors III, LLC, to manage our day-to-day operations and the acquisition and distribution of our real estate investments, subject to the board of director’s supervision. Because of the numerous conflicts of interest created by the relationships among us, our advisor and various affiliates, many of the responsibilities of the board of directors have been delegated to a committee that consists solely of independent directors. This committee is the conflicts committee and is discussed below under “Conflicts of Interest.”

Our charter provides that a majority of the directors must be independent directors. We currently have three independent directors on our five member board of directors. An “independent director” is a person who is not one of our officers or employees or an officer or employee of our advisor, our sponsor or its affiliates and has not been so for the previous two years and meets other independence requirements set forth in our charter.

Each director serves until the next annual meeting of shareholders and until his successor has been duly elected and qualified. The presence, in person or by proxy, of shareholders entitled to cast 50% of all of the votes entitled to be cast at any shareholder meeting constitutes a quorum. With respect to the election of directors, each candidate nominated for election to the board of directors must receive a majority of the votes present, in person or by proxy, in order to be elected. Therefore, if a nominee receives fewer “for” votes than “withhold” votes in an election, then the nominee will not be elected.

Although the number of board members may increase or decrease, a decrease may not have the effect of shortening the term of any incumbent director. Additionally, our charter requires that we have a minimum of three directors. Any director may resign at any time or may be removed with or without cause by the shareholders upon the affirmative vote of a least a majority of all the votes entitled to be cast a meeting called for the purpose of the proposed removal. The notice of the meeting will indicate that the purpose, or one of the purposes, of the meeting is to determine if the director will be removed.

Unless otherwise provided by Maryland law, the board of directors is responsible for selecting its own nominees and recommending them for election by the shareholders, provided that the conflicts committee nominates replacements for any vacancies among the independent director positions. Unless filled by a vote of the shareholders as permitted by Maryland General Corporation Law, a vacancy that results from the removal of a director will be filled by a vote of a majority of the remaining directors. Any vacancy on the board of directors for any other cause will be filled by a majority of the directors then in office, even if such majority is less than a quorum.

Our directors are accountable to us and our shareholders as fiduciaries. Our directors must perform their duties in good faith and in a manner each director believes to be in our and our shareholders’ best interests. Further, our directors must act with such care as a prudent person in a similar position would use under similar circumstances, including exercising reasonable inquiry when taking actions. However, our directors and executive officers are not required to devote all of their time to our business and must only devote such time to our affairs as their duties may require. We do not expect that our directors will be required to devote a substantial portion of their time to us in discharging their duties.

In addition to meetings of the various committees of the board, which committees we describe below, we expect our directors to hold at least four regular board meetings each year. Although we have no present intention to do so, our board has the authority to fix the compensation of all officers that it selects and may pay compensation to directors for services rendered to us in any other capacity.

Our general investment and borrowing policies are set forth in this prospectus. Our directors may establish further written policies on investments and borrowings and will monitor our administrative procedures, investment operations and performance to ensure that our executive officers follow these policies and that these policies continue to be in the best interests of our shareholders. Unless modified by our directors, we will follow the policies on investments and borrowings set forth in this prospectus.

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Executive Officers and Directors

We have provided below certain information about our executive officers and directors.

Name*	Age**	Positions
Enzio A. Cassinis	42	Chief Executive Officer and President
Adam Larson	37	Chief Financial Officer
Gregg Christensen	50	Chief Legal Officer and Secretary
Paul Fredenberg	43	Chief Investment Officer
Susan Hallenberg	51	Chief Accounting Officer and Treasurer
Chad Christensen	46	Director
Daniel Shaeffer	48	Chairman of the Board and Director
R. Brent Hardy	48	Independent Director
Gentry Jensen	48	Independent Director
John Lunt	46	Independent Director

* The address of each executive officer and director listed is 6340 South 3000 East, Suite 500, Salt Lake City, Utah 84121.

** As of August 1, 2019.

Enzio A. Cassinis has served as our Chief Executive Officer and President since October 1, 2018. In addition, Mr. Cassinis also serves as the Chief Executive Officer and President of Cottonwood Multifamily REIT I, Inc. and Cottonwood Multifamily REIT II, Inc., their advisor and our advisor. From June 2013 through September 2018, Mr. Cassinis served in various roles at Cottonwood Residential, Inc. Most recently, he served as the Senior Vice President of Corporate Strategy, where he was responsible for financial planning and analysis, balance sheet management and capital and venture formation activity.

Prior to joining Cottonwood Residential in June 2013, Mr. Cassinis was Vice President of Investment Management at Archstone, one of the largest apartment operators and developers in the U.S. and Europe. There, he negotiated transactions in both foreign and domestic markets with transaction volume exceeding several billion dollars in total capitalization. Prior to Archstone, Mr. Cassinis worked as an attorney with Krendl, Krendl, Sachnoff & Way, PC (now Kutak Rock LLP) from February 2003 to May 2006, focusing his practice on corporate law and merger and acquisition transactions.

Mr. Cassinis earned a Master of Business Administration and Juris Doctorate (Order of St. Ives) from the University of Denver, and a Bachelor of Science in Business Administration from the University of Colorado at Boulder and is a CFA^® charterholder.

Adam Larson has served as our Chief Financial Officer since October 1, 2018. Mr. Larson also serves as the Chief Financial Officer of Cottonwood Multifamily REIT I, Inc. and Cottonwood Multifamily REIT II, Inc., their advisor and our advisor. Through September 2018, Mr. Larson was the Senior Vice President of Asset Management of Cottonwood Residential, Inc. In this role he provided strategic guidance with respect to asset management, financial planning and analysis, and property operations. Prior to joining Cottonwood in June 2013, Mr. Larson worked in the Investment Banking Division at Goldman Sachs advising clients on mergers and acquisitions and other capital raising activities in the Real Estate, Consumer/Retail and Healthcare sectors. Mr. Larson previously worked at Barclays Capital, Bonneville Real Estate Capital and Hitachi Consulting. Mr. Larson holds an MBA from the University of Chicago Booth School Of Business, and a BS in Business Management from Brigham Young University where he also served as Student Body President.

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Gregg Christensen serves as our Chief Legal Officer and Secretary. Previously has served as our Executive Vice President, Secretary and General Counsel from December 2016 through October 2018. He served as one of our Directors from December 2016 to June 2018. He serves as Chief Legal Officer and Secretary for other programs sponsored by Cottonwood Residential, Inc., including Cottonwood Multifamily REIT I, Inc. and Cottonwood Multifamily REIT II, Inc. Mr. Christensen oversees and coordinates all legal aspects of our company and is also actively involved in our operations, acquisitions, and due diligence activities. Mr. Christensen also has served as the Executive Vice President, Secretary, General Counsel and a Director of Cottonwood Residential, Inc. and its predecessor entity since 2007. Prior to joining Cottonwood Residential, Inc., Mr. Christensen was a principal, managing director and general counsel of Cherokee & Walker, an investment company focused on real estate investments and private equity investments in real estate related companies. Previously, Mr. Christensen practiced law with Nelson & Senior in Salt Lake City. His areas of practice included real estate and corporate law. He is a member of the Utah State Bar, as well as the Bar of the United States District Court for the District of Utah. Mr. Christensen has been involved in real estate development, management, acquisition, disposition and financing for more than 21 years. Mr. Christensen holds an Honors Bachelor of Arts Degree in English from the University of Utah and a Juris Doctorate Degree from the University of Utah, S.J. Quinney College of Law. Gregg Christensen and Chad Christensen are brothers.

Paul Fredenberg has served as our Chief Investment Officer since October 1, 2018. Mr. Fredenberg also serves as the Chief Investment Officer of Cottonwood Multifamily REIT I, Inc. and Cottonwood Multifamily REIT II, Inc., their advisor and our advisor. Through September 2018, Mr. Fredenberg served as the Senior Vice President of Acquisitions of Cottonwood Residential, Inc. a position he had held since September, 2005. As Senior Vice President of Acquisitions, he focused exclusively on sourcing and evaluating new multifamily investment opportunities for Cottonwood Residential, Inc.

Prior to joining Cottonwood in 2005, Mr. Fredenberg worked in the Investment Banking division of Wachovia Securities advising clients on mergers and acquisitions activities across multiple industries. He has also held investment banking and management consulting positions at Piper Jaffray and the Arbor Strategy Group. Mr. Fredenberg holds an MBA from the Wharton School at the University of Pennsylvania, an MA in Latin American Studies from the University of Pennsylvania, and a BA in Economics from the University of Michigan, Ann Arbor.

Susan Hallenberg has served as our Chief Accounting Officer and Treasurer since October 2018. Ms. Hallenberg was our Chief Financial Officer from December 2016 through September 2018. In addition to serving as our Chief Accounting Officer and Treasurer, Ms. Hallenberg also serves as Chief Accounting Officer and Treasurer of Cottonwood Multifamily REIT I, Inc. and Cottonwood Multifamily REIT II, Inc., effective as of October 1, 2018. Ms. Hallenberg is also the Chief Financial Officer and Treasurer of Cottonwood Residential, Inc. and its predecessor entity, positions she has held since May 2005. Ms. Hallenberg has spent the majority of her career focused on real estate investment and prior to joining Cottonwood Residential O.P., LP, held positions at Phillips, Edison & Company, Lend Lease Real Estate Investments, and Aldrich Eastman & Waltch. Ms. Hallenberg started her career at Ernst & Young where she worked in the firm’s audit department for four years. Ms. Hallenberg holds a BA in Economics/Accounting from The College of the Holy Cross.

Daniel Shaeffer has served as one of our Directors since July 2016 and our Chairman of the Board since October 2018. Previously he served as our Chief Executive Officer from December 2016 to October 1, 2018. Mr. Shaeffer also has served as the Chief Executive Officer and a Director of Cottonwood Residential, Inc. and its predecessor entity since 2004. Before co-founding Cottonwood Capital, LLC, a predecessor to Cottonwood Residential, Inc., in 2004, Mr. Shaeffer worked as a senior equities analyst with Wasatch Advisors of Salt Lake City. Prior to joining Wasatch Advisors, Mr. Shaeffer was a Vice President of Investment Banking at Morgan Stanley. Mr. Shaeffer began his career with Ernst & Young working in the firm’s audit department. Mr. Shaeffer has been involved in real estate development, management, acquisition, disposition and financing for more than 12 years. Mr. Shaeffer holds an International MBA from the University of Chicago Graduate School of Business and a BS in Accounting from Brigham Young University and is a Certified Public Accountant.

The board of directors has determined that it is in the best interests of our company and our shareholders for Mr. Shaeffer, in light of his day-to-day company-specific operational experience, significant finance and market experience, and his real estate experience, to serve as a director on the board of directors.

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Chad Christensen has served as one of our Directors since July 2016 and as our President and Chairman of the Board from December 2016 to October 2018. Mr. Christensen also has served as the President and a Director of Cottonwood Residential, Inc. and its predecessor entity since 2004. Before co-founding Cottonwood Capital, LLC, a predecessor to Cottonwood Residential, Inc., in 2004, Mr. Christensen worked with the Stan Johnson Company, a national commercial Real Estate Brokerage firm in Tulsa, Oklahoma. Early in his career, Mr. Christensen founded Paramo Investment Company, a small investment management company. Mr. Christensen has been involved in real estate development, management, acquisition, disposition and financing for more than 14 years. Mr. Christensen holds a MBA from The Wharton School at the University of Pennsylvania with an emphasis in Finance and Real Estate and a BA in English from the University of Utah. Mr. Christensen also holds an active real estate license. Chad Christensen and Gregg Christensen are brothers.

The board of directors has determined that it is in the best interests of our company and our shareholders for Mr. Christensen, in light of his day-to-day company-specific operational experience, significant finance and market experience, and his real estate experience, to serve as a director on the board of directors.

R. Brent Hardy is one of our independent directors, a position he has held since June 2018. Since April 2018, Mr. Hardy has served as Managing Director and Senior Vice President of Asset Management at Merit Hill Capital, a real estate investment firm focused on acquiring and managing a portfolio of self-storage facilities across the United States. Mr. Hardy has been in the commercial real estate development, construction and asset management business for over 20 years. From September 2001 to April 2018, Mr. Hardy was Senior Vice President of Construction & Capital Asset Management at Extra Space Storage, the second largest operator of self-storage facilities in the United States and a New York Stock Exchange traded REIT. At Extra Space Storage, Mr. Hardy directed global construction, property development and long term asset preservations efforts and oversaw the “Certificate of Occupancy” and “Property Redevelopment and Expansion” programs. He contributed to the overall planned growth of the company, implementing essential asset management systems and processes to effectively oversee the firms portfolio of over 1450 assets nationwide. Mr. Hardy was also responsible for facility planning and design, property rebranding and corporate procurement efforts and was heavily involved in corporate responsibility, portfolio efficiency and innovation, and the implementation of energy management and sustainability programs. Prior to commencing his career with Extra Space Storage, Mr. Hardy spent several years with various firms in real estate, construction and operations management.

Mr. Hardy graduated from the University of Utah with a B.A. degree in Political Science and a minor in Spanish.

Our board of directors selected Mr. Hardy as an independent director for reasons including his over 20 years of experience in the commercial real estate development, construction and asset management industries and his strategic business abilities and skills in responding to operational challenges and opportunities within an organization. In particular, our board of directors believes Mr. Hardy’s experience in asset management at Extra Space Storage during a period of growth at the company the depth and breadth of Mr. Hardy’s exposure to complex real estate, strategic and corporate issues throughout his career would make him a valuable asset to our board of directors. Having worked at a public REIT gives him additional perspective and insight into public companies such as ours.

Gentry Jensen is one of our independent directors, a position he has held since June 2018. Since 2011, Mr. Jensen has served as the Chief Executive Officer of Penumbra Brands, Inc., a leading provider of protective, technologically differentiated, accessories for mobile devices. From 2009 to 2011, he served as District Manager of Schindler Elevator Corporation and from 2005 through 2008, he served as President of Wentworth Development, a Utah-based commercial real estate brokerage and property management firm, and from 2002 through 2004, Mr. Jensen was an associate in asset management and portfolio construction modeling with J.P. Morgan’s Private Bank in New York. Prior to entering the business world, Mr. Jensen served on active duty as a Navy SEAL, completing overseas deployments in Eastern Europe and throughout Asia.

Mr. Jensen holds an MBA in Finance from the Wharton School at the University of Pennsylvania and a BS, with Merit, in Systems Engineering from the United States Naval Academy.

Our board of directors selected Mr. Jensen as an independent director for reasons including his executive leadership experience with multiple companies and as a Navy SEAL, his professional and educational background and his prior experience in commercial real estate brokerage and property management.

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John Lunt is one of our independent directors, a position he has held since June 2018. In January 2003, Mr. Lunt founded Lunt Capital Management, Inc., a registered investment advisor, and since January 2003, he has served as its President. The firm builds and manages investment strategies used by financial advisors around the United States and provides research and advice for investments across asset classes, including U.S. equities, international equities, fixed income, real estate, commodities and currencies. Mr. Lunt co-created the methodology for seven index strategies calculated by S&P Dow Jones Indices. He is a charter member of the ETF Strategists Roundtable for key influencers associated with ETF management, and writes regularly about financial markets for ETFTrends.com. From 2001 to June 2014, he served on the board of the Utah Retirement Systems, a $20 billion pension fund, and from 2004 to 2007, he served as board President. Since February 2013, Mr. Lunt has served on the investment advisory committee for the $10 billion Utah Educational Savings Plan (My529) and since August 2017, he served as Chairman of the committee. Since September 2014, he has served as a member of the Board of Trustees for the $2 billion Utah School & Institutional Trust Funds Office. He has been a featured speaker at investment conferences around the United States, and has written extensively about financial markets.

Mr. Lunt graduated Magna Cum Laude with University Honors from Brigham Young University with a B.A. degree in Economics, and he later received an MBA in Finance and International Business from New York University. Mr. Lunt completed the Program for Advanced Trustee Studies at Harvard Law School and finished a number of courses at the New York Institute of Finance on trading and portfolio management.

Our board of directors selected Mr. Lunt as an independent director for reasons including his executive leadership experience, his professional and educational background, his network of relationships with finance and investment professionals and his extensive background and experience in public markets and in real estate and finance transactions and investments. In addition, his experience as founder and President of Lunt Capital Management and his service as a director of various pension funds provide him an understanding of the issues facing companies that make investments in real estate and oversee those investments.

Board Committees

Our board of directors has established three standing committees, consisting solely of independent directors: the audit committee, the conflicts committee and the compensation committee.

Audit Committee

Among other things, the audit committee assists the board in overseeing:

• our accounting and financial reporting processes;

• the integrity and audits of our financial statements;

• our compliance with legal and regulatory requirements;

• the qualifications and independence of our independent registered public accounting firm; and

• the performance of our internal auditors and our independent registered public accounting firm.

The audit committee is also responsible for engaging our independent registered public accounting firm, reviewing with the independent registered public accounting firm the plans and results of the audit engagement, and considering and approving the audit and non-audit services and fees provided by the independent registered public accounting firm. The members of the audit committee are Messrs. Hardy, Jensen and Lunt. Mr. Lunt is the audit committee financial expert.

Conflicts Committee

In order to reduce or eliminate certain potential conflicts of interest, our charter creates a conflicts committee of our board of directors consisting solely of all of our independent directors, that is, all of our directors who are not affiliated with our advisor. Our charter authorizes the conflicts committee to act on any matter permitted under Maryland law. Both the board of directors and the conflicts committee must act upon those conflict-of-interest matters that cannot be delegated to a committee under Maryland law. Our charter also empowers the conflicts committee to retain its own legal and financial advisors. See “Conflicts of Interest—Certain Conflict Resolution Measures.” Our charter requires that the conflicts committee discharge the board’s responsibilities relating to the nomination of independent directors. The members of the conflicts committee are Messrs. Hardy, Jensen and Lunt.

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Compensation Committee

The primary purpose of the compensation committee is to oversee our compensation programs. The committee reviews the compensation and benefits paid by us to our directors and, in the event we hire employees, the compensation paid to our executive officers as well as any employment, severance and termination agreements or arrangements made with any executive officer and, if required, produces the report to be included in our annual proxy statement. Subject to the limitations in our charter, the compensation committee may also create stock-award plans. We are externally managed by our advisor pursuant to the advisory agreement and as of the date hereof we have no employees.

The compensation committee may, in its discretion, delegate all or a portion of its duties and responsibilities to a subcommittee of the committee. In particular, the committee may delegate the approval of certain transactions to a subcommittee consisting solely of members of the compensation committee who are (i) “Non-Employee Directors” for the purposes of Rule 16b-3 under the Exchange Act, and (ii) “outside directors” for the purposes of Section 162(m) of the Internal Revenue Code. The members of the compensation committee are Messrs. Hardy, Jensen and Lunt.

Compensation of Directors

Any member of our board of directors who is also an employee of our advisor or sponsor does not receive additional compensation for serving on our board of directors. Each independent director receives an annual retainer of $10,000. We pay independent directors for attending board and committee meetings as follows:

• $500 in cash for each board meeting attended (including if by teleconference); and

• $500 in cash for each committee meeting attended (if at a different time or place than a board meeting and including if by teleconference).

We also reimburse our directors for their travel expenses incurred in connection with their attendance at board and committee meetings.

Limited Liability and Indemnification of Directors, Officers, Employees and Other Agents

Our charter limits the liability of our officers and directors to us and our shareholders for monetary damages and requires us to indemnify our directors, officers, our advisor and its affiliates for losses they may incur by reason of their service in that capacity or in their service as a director, officer, partner, member, manager or trustee of another corporation, partnership, limited liability company, joint venture, trust or other entity, if all of the following conditions are met:

• the party seeking exculpation or indemnification has determined, in good faith, that the course of conduct that caused the loss or liability was in our best interests;

• the party seeking exculpation or indemnification was acting on our behalf or performing services for us;

• in the case of an independent director, the liability or loss was not the result of gross negligence or willful misconduct by the independent director;

• in the case of a non-independent director, our advisor or one of its affiliates, the liability or loss was not the result of negligence or misconduct by the party seeking exculpation or indemnification; and

• the indemnification is recoverable only out of our net assets and not from the common shareholders.

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The SEC takes the position that indemnification against liabilities arising under the Securities Act is against public policy and unenforceable. Furthermore, our charter prohibits the indemnification of our directors, our advisor, its affiliates or any person acting as a broker-dealer for liabilities arising from or out of a violation of state or federal securities laws, unless one or more of the following conditions are met:

• there has been a successful adjudication on the merits in favor of the indemnitee of each count involving alleged securities law violations;

• such claims have been dismissed with prejudice on the merits by a court of competent jurisdiction; or

• a court of competent jurisdiction approves a settlement of the claims against the indemnitee and finds that indemnification of the settlement and the related costs should be made, and the court considering the request for indemnification has been advised of the position of the SEC and of the published position of any state securities regulatory authority in which the securities were offered as to indemnification for violations of securities laws.

Our charter further provides that the advancement of funds to our directors and to our advisor and its affiliates for reasonable legal expenses and other costs incurred in advance of the final disposition of a proceeding for which indemnification is being sought is permissible only if all of the following conditions are satisfied: the proceeding relates to acts or omissions with respect to the performance of duties or services on our behalf; the legal proceeding was initiated by a third party who is not a common shareholder or, if by a common shareholder acting in his or her capacity as such, a court of competent jurisdiction approves such advancement; and the person seeking the advancement agrees to repay the amount paid or reimbursed by us, together with the applicable legal rate of interest thereon, if it is ultimately determined that such person is not entitled to indemnification.

We also purchase and maintain insurance on behalf of all of our directors and executive officers against liability asserted against or incurred by them in their official capacities with us, whether or not we are required or have the power to indemnify them against the same liability. We may incur significant costs to purchase this insurance on behalf of our officers and directors.

Our Advisor

Our advisor, CC Advisors III, LLC, is a recently formed Delaware limited liability company. Our advisor has contractual responsibilities to us and our shareholders. The sole member and manager of CC Advisors III, LLC is Cottonwood Communities Advisor, LLC.

The officers of Cottonwood Communities Advisor, LLC are as follows:

Name*	Age**	Positions
Enzio A. Cassinis	42	Chief Executive Officer
Adam Larson	37	Chief Financial Officer
Gregg Christensen	50	Chief Legal Officer
Paul Fredenberg	43	Chief Investment Officer
Susan Hallenberg	51	Chief Accounting Officer

* The address of each executive officer and director listed is 6340 South 3000 East, Suite 500, Salt Lake City, Utah 84121.

** As of August 1, 2019.

The backgrounds of Messrs. Cassinis, Larson, Christensen, Fredenberg and Ms. Hallenberg are described in the “Management – Executive Officers and Directors” section of this prospectus.

The Advisory Agreement

Under the terms of the advisory agreement, our advisor will use its reasonable efforts to present to us investment opportunities that provide a continuing and suitable investment program for us consistent with our investment policies and objectives as adopted by our board of directors. Pursuant to the advisory agreement, our advisor (subject to the supervision and authority of our board of directors and officers) manages our day-to-day

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operations, retains the property managers for our property investments and performs other duties, including, but not limited to, the following:

• finding, presenting and recommending investment opportunities to us consistent with our investment policies and objectives;

• making certain real estate-related debt investment decisions for us, subject to the limitations in our charter and the direction and oversight of our board of directors;

• structuring the terms and conditions of our investments, sales and joint ventures;

• acquiring properties and other investments on our behalf in compliance with our investment objectives and policies;

• arranging for financing and refinancing of properties and our other investments;

• entering into leases and service contracts for our real properties;

• supervising and evaluating each loan servicer’s and property manager’s performance;

• reviewing and analyzing the operating and capital budgets of properties underlying our investments and properties we may acquire;

• entering into servicing contracts for our loans;

• assisting us in obtaining insurance;

• generating an annual budget for us;

• reviewing and analyzing financial information for each of our assets and the overall portfolio;

• formulating and overseeing the implementation of strategies for the administration, promotion, management, operation, maintenance, improvement, financing and refinancing, marketing, leasing and disposition of our properties and other investments;

• performing investor-relations services;

• maintaining our accounting and other records and assisting us in filing all reports required to be filed with the SEC, the Internal Revenue Service and other regulatory agencies;

• engaging and supervising the performance of our agents, including our registrar and transfer agent; and

• performing any other services reasonably requested by us.

See “Management Compensation” for a detailed discussion of the fees payable to our advisor under the advisory agreement.

The advisory agreement has a one-year term but may be renewed for an unlimited number of successive one-year periods upon the mutual consent of our advisor and us. It will be the duty of our board of directors to evaluate the performance of our advisor before entering into or renewing an advisory agreement. Additionally, either party may terminate the advisory agreement without cause or penalty upon 60 days’ written notice and, in such event, our advisor must cooperate with us and our directors in making an orderly transition of the advisory function. In the event that the advisory agreement is not renewed or terminates (other than because of fraud, gross negligence or willful misconduct by our advisor) before August 13, 2028, the payment of any contingent acquisition fees and contingent financing fees will be immediately due and payable by us to our advisor. For more information regarding the terms of the advisory agreement, see “Management Compensation.”

Initial Investment by Cottonwood Residential O.P., LP

Cottonwood Residential O.P., LP has invested $200,000 in us through the purchase of 20,000 shares of our common stock at $10.00 per share. Cottonwood Residential O.P., LP may not sell any of these shares during the period CC Advisors III, LLC serves as our advisor. Cottonwood Residential O.P., LP will not vote any shares it acquires in any vote for the removal of directors or any vote regarding the approval or termination of any contract with our advisor or any of its affiliates. Although nothing prohibits Cottonwood Residential O.P., LP or its affiliates from acquiring additional shares of our common stock, they currently do not have any options or warrants to acquire any shares.

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Additional Investment by Cottonwood O.P., LP

In addition to its original $200,000 investment in shares, Cottonwood Residential O.P., LP may continue to acquire more common stock so that Cottonwood Residential O.P., LP owns up to 5% of the outstanding shares of our common stock.

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MANAGEMENT COMPENSATION

Although we have executive officers who manage our operations, we have no paid employees. Our advisor, CC Advisors III, LLC and the real estate professionals at the advisor manage our day-to-day affairs and portfolio of multifamily apartment communities and multifamily real estate-related assets, subject to the board of directors’ supervision. The following table summarizes all of the compensation and fees that will be paid to our advisor, CC Advisors III, LLC, and its affiliates in connection with this offering, including amounts to reimburse their costs in providing services. The compensation set forth below may only be increased if approved by a majority of the members of our conflicts committee. The increase of such compensation does not require approval by shareholders.

Form of Compensation and Recipient	Determination of Amount	Estimated Amount for Maximum Primary Offering(1)
	Acquisition and Development Stage
Contingent Acquisition Fee – CC Advisors III, LLC (Our Advisor)(2)(3)(4)	After our common shareholders have received, or are deemed to have received (with respect to a merger or a listing), together as a collective group, aggregate distributions sufficient to provide a return of their invested capital, plus a specified cumulative, noncompounded annual return on their invested capital (a “Required Return”), our advisor will receive from us contingent acquisition fees that are a percentage of the cost of investments acquired or originated by us, or the amount to be funded by us to acquire or originate loans, including acquisition and origination expenses and any debt attributable to such investments plus significant capital expenditures related to the development, construction or improvement of the investment as follows: 1% contingent acquisition fee if common shareholders receive a Required Return of 6%; and 2% additional contingent acquisition fee if common shareholders receive a Required Return of 13%. The contingent acquisition fee is payable upon satisfying each return threshold with respect to assets in the portfolio at the time the return threshold is satisfied and at the closing of acquisitions following satisfaction of the return threshold.	$15,000,000 (maximum offering, target leverage of 55% of the cost of our investments, 6% Required Return)/ $45,000,000 (maximum offering, target leverage of 55% of the cost of our investments, 13% Required Return)
Acquisition Expense Reimbursement – CC Advisors III, LLC (Our Advisor)	Subject to the limitations contained in our charter, reimbursement from us for all out-of-pocket expenses incurred in connection with the selection and acquisition or origination of investments, whether or not we ultimately acquire the property or other real estate-related investment.	Actual amounts are dependent upon actual expenses incurred and, therefore, cannot be determined at this time.
Contingent Financing Fee – CC Advisors III, LLC (Our Advisor) (3)(4)(5)	After our common shareholders have received, or are deemed to have received (with respect to a merger or a listing), together as a collective group, aggregate distributions sufficient to provide a return of their invested capital, plus a Required Return of 13%, our advisor will receive from us a contingent financing fee of 1% of the original principal amount of any financing obtained or assumed by us. The contingent financing fee is payable upon satisfying the return threshold with respect to any financing obtained or assumed by us prior to satisfaction of the return threshold and at the closing of new financing following satisfaction of the return threshold.	$8,250,000 (maximum offering, target leverage of 55% of the cost of our investments, 13% Required Return)

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Form of Compensation and Recipient	Determination of Amount	Estimated Amount for Maximum Primary Offering(1)
	Operational Stage
Property Management Fees –Cottonwood Communities Management, LLC (Our Property Manager)	Cottonwood Communities Management, LLC receives from us a property management fee in an amount up to 3.5% of the annual gross revenues of our multifamily apartment communities that it manages. Cottonwood Communities Management, LLC may subcontract the performance of its property management duties to third parties and Cottonwood Communities Management, LLC will pay a portion of its property management fee to the third parties with whom it subcontracts for these services.	Actual amounts depend upon the gross revenue of the properties and therefore cannot be determined at this time.
Asset Management Fee – CC Advisors III, LLC (Our Advisor)	CC Advisors III, LLC receives from us an annual asset management fee, paid monthly, in an amount equal to 1.25% of our gross assets as of the last day of the prior month. For purposes of calculating the asset management fee, “gross assets” means (i) the gross book value of our assets until such time as our board of directors has established a net asset value of our assets, and (ii) after our board of directors has established a net asset value of our assets, the gross asset value of our assets based on the net asset value determination; provided that, the value of any assets acquired after our determination of a net asset value will be the gross book value of the assets until such assets are included in a net asset value determination. Under (i) or (ii), gross book value or gross asset value (as applicable) will be determined based on our pro rata ownership interest in the underlying real estate (including the pro rata value of any budgeted development-related project costs and/or debt underlying any mezzanine loans, preferred equity, other real estate-related investments such as B-notes and/or common equity investments) and other assets and liabilities, without regard to GAAP consolidation or equity method accounting principles. We plan to determine the net asset value of our common stock no later than May 17, 2021, and annually thereafter.	Actual amounts depend upon the gross offering proceeds we raise in this offering and therefore cannot be determined at this time.
Other Company Operating Expenses – CC Advisors III, LLC (Our Advisor or its affiliates)(6)	We reimburse our advisor or its affiliates for all actual expenses paid or incurred by our advisor or its affiliates in connection with the services provided to us, including our allocable share of the advisor’s or its affiliates’ overhead, such as rent, personnel costs, utilities, cybersecurity and IT costs; provided, however, that we do not reimburse our advisor or its affiliates for salaries, wages and related benefits of personnel who perform investment advisory services for us or serve as our executive officers. In addition, subject to the approval of our board of directors we may reimburse our advisor or its affiliates for costs and fees associated with providing services to us that we would otherwise engage a third party to provide.	Actual amounts are dependent upon the results of our operations; we cannot determine these amounts at the present time.

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Form of Compensation and Recipient	Determination of Amount	Estimated Amount for Maximum Primary Offering(1)
Promotional Interest from Operating Partnership – Cottonwood Communities Advisors Promote, LLC	Cottonwood Communities Advisors Promote, LLC will receive from the Operating Partnership a promotional interest equal to 15% of net income and cash distributions, but only after our common shareholders receive, together as a collective group, distributions sufficient to provide a return of their invested capital plus a 6% cumulative, non-compounded annual return on their invested capital. Cottonwood Communities Investor, LLC, the sole limited partner of our operating partnership assigned its promotional interest to Cottonwood Communities Advisors Promote, LLC. Neither Cottonwood Communities Investor, LLC nor Cottonwood Communities Advisors Promote, LLC were required to make any capital contributions to our operating partnership in order to obtain the promotional interest.	Actual amounts depend on the results of the performance of the multifamily apartment communities and therefore cannot be determined at this time.
	Cottonwood Communities Advisors Promote, LLC will be entitled to a separate one-time payment payable upon (1) the listing of our common stock on a national securities exchange or (2) the occurrence of certain events that result in the termination or non-renewal of our advisory agreement, in each case for an amount that Cottonwood Communities Advisors Promote, LLC would have been entitled to receive, as described above, as if our Operating Partnership had disposed of all of its assets at the market value of our shares of common stock as of the date of the event triggering the payment. If the event triggering the payment is a listing of our shares on a national securities exchange, the market value will be calculated based on the market value of the shares issued and outstanding at listing over a period of 30 trading days selected by our advisor beginning after the first day of the 6th month, but not later than the last day of the 18th month, after the shares are first listed on a national securities exchange. If the triggering event is the termination or non-renewal of our advisory agreement the market value will be calculated based on an appraisal or valuation of our assets by an independent third party. In addition, if this separate one-time payment is owed following the termination or non-renewal of our advisory agreement for reasons unrelated to a liquidity event for our common shareholders, the payment will be in the form of an interest-bearing promissory note that is payable only after our common shareholders have actually received distributions in the amount required before receipt of the promotional interest. Provided, however, if the promissory note has not been repaid prior to a liquidity event for our common shareholders, the promissory note shall be paid in full on the date of or immediately prior to the liquidity event.

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Form of Compensation and Recipient	Determination of Amount	Estimated Amount for Maximum Primary Offering(1)
Independent Director Compensation	We pay each of our independent directors an annual retainer of $10,000. We also pay our independent directors for attending meetings as follows: (i) $500 for each board meeting attended and (ii) $500 for each committee meeting attended (if held at a different time or place than a board meeting). All directors receive reimbursement of reasonable out of pocket expenses incurred in connection with attendance at meetings of the board of directors.	Actual amounts are dependent upon the total number of board and committee meetings that each independent director attends and therefore cannot be determined at this time.

⁽¹⁾ The estimated maximum dollar amounts are based on the sale of $675,000,000 in shares to the public in the primary offering and exclude the $75,000,000 we have registered under our distribution reinvestment plan as we do not expect the fees paid in this offering to be determined based on proceeds raised in our distribution reinvestment plan offering. We reserve the right to reallocate shares between our primary offering and our distribution reinvestment plan offering, and to the extent we reallocate shares from the distribution reinvestment plan offering to the primary offering, the fees disclosed above will be higher.

⁽²⁾  Under our charter, a majority of the independent directors would have to approve any increase in the contingent acquisition fee payable to our advisor. If our advisor is terminated before August 13, 2028 for any reason other than the advisor’s fraud, willful misconduct or gross negligence, the payment of a contingent acquisition fee will be immediately due and payable in an amount equal to 3% less the amount of any prior payments of contingent acquisition fees to our advisor. Because the acquisition fee we pay our advisor is a percentage of the cost of investments acquired or originated by us, or the amount to be funded by us to acquire or originate a loan, this fee will be greater to the extent we fund acquisitions and originations through (i) the incurrence of debt which exceeds the target leverage of 55% disclosed in the table, (ii) retained cash flow from operations, (iii) issuances of equity in exchange for assets and (iv) proceeds from the sale of shares under our distribution reinvestment plan.

⁽³⁾ Our charter limits our ability to make an investment if the total of all acquisition fees and acquisition expenses and financing fees relating to the investment exceeds 6% of the contract purchase price or 6% of the funds advanced. This limit may only be exceeded if a majority of the board of directors (including a majority of the members of the conflicts committee) not otherwise interested in the transaction approves the fees and expenses and finds the transaction to be commercially competitive, fair and reasonable to us.

⁽⁴⁾  In the event of a merger, our common shareholders will be deemed to have received aggregate distributions sufficient to provide a return of their invested capital, plus a Required Return if the merger consideration amount plus the total of all distributions paid or declared by us to common shareholders from inception until the closing of the merger (excluding any stock dividends) exceeds the return threshold. In the event of a listing of our common stock on a national securities exchange, our common shareholders will be deemed to have received aggregate distributions sufficient to provide a return of their invested capital, plus a Required Return if the market value of our outstanding shares plus the total of all distributions paid by us to common shareholders from inception until the date market value is determined (excluding any stock dividends) exceeds the return threshold. The market value of our outstanding shares will be calculated based on the market value of the shares issued and outstanding at listing over a period of 30 trading days selected by our advisor beginning after the first day of the 6th month, but not later than the last day of the 18th month, after the shares are first listed on a national securities exchange.

⁽⁵⁾  If our advisor is terminated before August 13, 2028 of our operations for any reason other than the advisor’s fraud, willful misconduct or gross negligence, the payment of the contingent financing fee will be immediately due and payable.

⁽⁶⁾  On June 30, 2020, our advisor must reimburse us the amount by which our aggregate total operating expenses for the four fiscal quarters then ended exceed the greater of 2% of our average invested assets or 25% of our net income, unless the conflicts committee has determined that such excess expenses were justified based on unusual and non-recurring factors. “Average invested assets” means the average monthly book value of our assets during the 12-month period before deducting depreciation, bad debts or other non-cash reserves. “Total operating expenses” means all expenses paid or incurred by us that are in any way related to our operation, including advisory fees, but excluding (a) the expenses of raising capital to the extent paid by us such as organization and offering expenses, legal, audit, accounting, underwriting, brokerage, listing, registration and other fees, printing and other such expenses and taxes incurred in connection with the issuance, distribution, transfer, registration and stock exchange listing of our stock; (b) interest payments; (c) taxes; (d) non-cash expenditures such as depreciation, amortization and bad debt reserves; (e) reasonable incentive fees based on the gain in the sale of our assets; and (f) acquisition and origination fees, acquisition and origination expenses (including expenses relating to potential investments that we do not close), disposition fees on the sale of real property and other expenses connected with the acquisition, origination, disposition and ownership of real estate interests, loans or other property (other than disposition fees on the sale of assets other than real property), such as the costs of foreclosure, insurance premiums, legal services, maintenance, repair and improvement of property.

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STOCK OWNERSHIP

The following table sets forth the beneficial ownership of our common stock as of the date of this prospectus for each person or group that holds more than 5% of our common stock, for each director and executive officer and for our directors and executive officers as a group.

Name of Beneficial Owner (1)	Number of Shares Beneficially Owned		Percent of All Shares
Enzio A. Cassinis, Chief Executive Officer and President		—		—
Adam Larson, Chief Financial Officer		—		—
Gregg Christensen, Chief Legal Officer and Secretary(2)		20,000		*
Paul Fredenberg, Chief Investment Officer		—		—
Susan Hallenberg, Chief Accounting Officer and Treasurer		—		—
Chad Christensen, Director(2)		20,000		*
Daniel Shaeffer, Director(2)		20,000		*
R. Brent Hardy, Independent Director		—		—
Gentry Jensen, Independent Director		—		—
John Lunt, Independent Director		—		—
All directors and executive officers as a group		—		—

* Less than 1%

⁽¹⁾ The address of each beneficial owner listed is 6340 South 3000 East, Suite 500, Salt Lake City, Utah 84121.

⁽²⁾ Gregg Christensen, Daniel Shaeffer, and Chad Christensen are three of the five directors that comprise the board of directors of Cottonwood Residential II, Inc., the general partner of Cottonwood Residential O.P., LP. Cottonwood Residential O.P., LP owns 20,000 shares of our common stock outstanding. As members of the board of directors of Cottonwood Residential II, Inc., Messrs. Shaeffer, Christensen and Christensen will have the voting and investment control of the shares of our common stock held by Cottonwood Residential O.P., LP.

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CONFLICTS OF INTEREST

We are subject to various conflicts of interest arising out of our relationship with CC Advisors III, LLC, our advisor, and its affiliates, including Cottonwood Residential O.P., LP and Cottonwood Residential II, Inc. We discuss these conflicts below and conclude this section with a discussion of the corporate governance measures we have adopted to ameliorate some of the risks posed by these conflicts.

Our Affiliates’ Interests in Other Cottonwood Real Estate Programs

General

All of our executive officers and two of our directors, and other key real estate professionals of our advisor are also officers, directors, managers, key professionals and/or holders of a direct or indirect voting controlling interest (but not a controlling economic interest) in Cottonwood Residential O.P., LP, Cottonwood Residential II, Inc., our advisor, or their affiliates. These individuals have legal and other obligations with respect to Cottonwood Residential O.P., LP and Cottonwood Residential II, Inc., or our advisor, and the shareholders and investors in such entities which are similar to their obligations to us. Thus, there may be conflicts of interest with respect to the officers’ and director’s obligations and duties to these entities and their obligations and duties to us and our affiliates. In the future, these persons may also form other real estate investment vehicles, to which they will have similar obligations.

All of our executive officers and some of our directors, and the key real estate professionals of our advisor are also officers, directors, managers, key real estate professionals, and/or holders of a direct or indirect controlling interest in or for:

• Cottonwood Communities Advisors Promote, LLC, the entity which owns the incentive fee in us;

• CC Advisors III, LLC, our advisor;

• Cottonwood Communities Management, LLC, our property manager.

Some of these persons also serve as executive officers and directors, and the key real estate professionals in and for Cottonwood Residential O.P., LP’s other affiliates. As a result, such persons owe fiduciary duties to Cottonwood Residential O.P., LP and/or its affiliates. These fiduciary duties may from time to time conflict with the fiduciary duties that they owe to us.

As described in the “Prior Performance Summary,” affiliates of our advisor have sponsored and advise the following real estate programs with investment objectives similar to ours:

• Cottonwood Multifamily REIT I, Inc.

• Cottonwood Multifamily REIT II, Inc.

• Cottonwood Multifamily Opportunity Fund, Inc.

Conflicts of interest may arise between us and the programs that have not been liquidated and between us and future programs. As of the date of this prospectus, none of the above programs have been liquidated and are still operating. Thus, to the extent that we seek to acquire and lease assets in similar geographic markets, we will compete with the above programs. As of the date of this prospectus, Cottonwood Multifamily REIT I, Inc. and Cottonwood Multifamily REIT II, Inc. have completed their offerings and have invested substantially all of the proceeds from their offerings. Cottonwood Multifamily Opportunity Fund, Inc. has closed its offering and is still investing the proceeds. As of the date of this prospectus it has made an initial investment in a development project for a multifamily apartment community.

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Allocation of Investment Opportunities

We rely on our advisor to identify suitable investments. Many investment opportunities that are suitable for us may also be suitable for Cottonwood Residential O.P., LP and Cottonwood Residential II, Inc. or other programs sponsored by such persons and affiliates of such persons. It is the intent of our advisor and us that our advisor and its affiliates will allocate potential investments between us and other entities that are sponsored by our advisor and its affiliates in a manner designed to meet each entity’s investment objectives by considering the investment portfolios of each entity, the cash available for investment by each entity and diversification objectives.

Competition for Tenants and Others

Conflicts of interest may exist to the extent that we acquire properties in the same geographic areas where other Cottonwood real estate programs or affiliated entities own multifamily apartment communities. In such a case, a conflict could arise in the leasing of properties or apartment units in the event that we and another Cottonwood real estate program or affiliated entity were to compete for the same tenants in negotiating leases, or a conflict could arise in connection with the resale of properties in the event that we and another Cottonwood real estate program or affiliated entity were to attempt to sell similar properties at the same time. Conflicts of interest may also exist at such time as we or any of our affiliates managing property on our behalf seek to employ developers, contractors, building managers or other third parties. Our advisor and its affiliates, including the advisors of other Cottonwood real estate programs and affiliated entities, will seek to reduce conflicts that may arise with respect to properties available for sale or rent by making prospective purchasers or tenants aware of all such properties. Our advisor and the advisors of other Cottonwood real estate programs and affiliated entities also will seek to reduce conflicts relating to the employment of developers, contractors or building managers by making prospective service providers aware of all properties in need of their services. However, our advisor and the advisors of other Cottonwood real estate programs and affiliated entities cannot fully avoid these conflicts because they may establish differing terms for resales or leasing of the various properties or differing compensation arrangements for service providers at different properties.

Allocation of Our Affiliates’ Time

We rely on our advisor and our board of directors, and the team of real estate professionals that our advisor and its affiliates has assembled for the day-to-day operation of our business. Cottonwood Residential O.P., LP and Cottonwood Residential II, Inc. and other investment programs managed and controlled by Cottonwood affiliates are also advised by many of the same real estate and management professionals as will future Cottonwood-sponsored programs. In addition, Cottonwood Capital Property Management II, LLC (a subsidiary of the sole member of our advisor) has acted as the sponsor to Cottonwood Multifamily REIT I, Inc., Cottonwood Multifamily REIT II, Inc., and Cottonwood Multifamily Opportunity Fund, Inc. In addition, through two different subsidiary entities, Cottonwood Communities Advisor, LLC acts as the advisor to Cottonwood Multifamily REIT I, Inc. and Cottonwood Multifamily REIT II, Inc. As a result of their interests in these and other Cottonwood- sponsored programs, their obligations to other investors and the fact that they engage in and they will continue to engage in other business activities on behalf of themselves and others, these real estate and management professionals will likely face conflicts of interest in allocating their time among us and Cottonwood -sponsored programs and other business activities in which they are involved. Our executive officers and our key real estate and management professionals are not obligated to devote a fixed amount of their time to us.

We believe that our executive officers and the other key real estate professionals have sufficient time to fully discharge their responsibilities to us and to the other businesses in which they are involved. We believe that our affiliates and executive officers will devote the time required to manage our business and expect that the amount of time a particular executive officer or affiliate devotes to us will vary during the course of the year and depend on our business activities at the given time. It is difficult to predict specific amounts of time an executive officer or affiliate will devote to us. We expect that our executive officers and affiliates will generally devote more time to programs raising and investing capital than to programs that have completed their offering stages, though from time to time each program will have its unique demands. Because many of the operational aspects of Cottonwood Residential O.P., LP programs are very similar, there are significant efficiencies created by the same team of individuals providing services to multiple programs.

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Receipt of Fees and Compensation by our Advisor, Cottonwood Communities Advisors Promote, LLC and their Affiliates

Cottonwood Communities Advisors Promote, LLC receives a promotional interest equal to 15% of net income and cash distributions, but only after our common shareholders receive, together as a collective group, cumulative distributions in an amount sufficient to provide our common shareholders with a return of their invested capital plus a 6% cumulative, non-compounded annual return on their investment.

We have engaged CC Advisors III, LLC as our advisor and Cottonwood Communities Management, LLC, as our property manager. Both are affiliates of Cottonwood Residential O.P., LP and receive compensation for services as our advisor and property manager. This compensation arrangement could affect our judgment with respect to:

• the continuation, renewal or enforcement of the advisory agreement between us, our subsidiaries and CC Advisors III, LLC;

• acquisitions of properties and other investments, which entitle our advisor to asset management fees and possibly property management fees and may entitle our advisor to contingent acquisition fees, which contingent acquisition fees are based on the purchase price of the investment, and are not based on the quality of the investment or the quality of the services rendered to us, which may influence our advisor to accept a higher purchase price for those assets, recommend riskier transactions to us or purchase assets that may not be in the best interest of our shareholders;

• borrowings to acquire properties and other investments, which borrowings will increase the asset management fees payable to our advisor as well as potentially entitle the advisor to a contingent financing fee and an increased contingent acquisition fee;

• decisions regarding the disposition of assets that would result in the termination of any property related fees as well as decreasing the asset management fees payable to our advisor, and may entitle Cottonwood Communities Advisors Promote, LLC to a promotional interest from our operating partnership;

• offerings of equity by us, which will likely entitle our advisor to increased asset management fees and may entitle our advisor to increased contingent acquisition fees; and

• whether and when we seek to sell the company or its assets, which sale could entitle Cottonwood Communities Advisors Promote, LLC to a promotional interest from our operating partnership.

Fiduciary Duties Owed by Some of Our Affiliates to Our Advisor and Our Advisor’s Affiliates

Our executive officers, some of our directors and the key real estate professionals at our advisor are also officers, directors, managers or key professionals for:

• CC Advisors III, LLC, our advisor;

• Cottonwood Communities Management, LLC, our property manager; and

• other Cottonwood real estate sponsored programs.

As a result, their loyalties to each of these programs, their shareholders, members and limited partners may from time to time conflict with the fiduciary duties that they owe us.

Affiliated Property Manager

Since properties and debt investments we acquire will likely be managed by Cottonwood Communities Management, LLC, to the extent we retain Cottonwood Communities Management, LLC, we will not have the benefit of negotiating fees with an independent property manager. Cottonwood Communities Management, LLC may subcontract the performance of its property management duties to third parties and Cottonwood Communities Management, LLC will pay a portion of its property management fee to the third parties with whom it subcontracts for these services. See “Management—Other Affiliates.”

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Certain Conflict Resolution Measures

Conflicts Committee

In order to reduce or eliminate certain potential conflicts of interest, our charter creates a conflicts committee of our board of directors composed of all of our independent directors. An “independent director” is a person who is not one of our officers or employees or an officer or employee of our advisor, the sponsor or its affiliates and has not been so for the previous two years and meets the other requirements set forth in our charter. Our charter authorizes the conflicts committee to act on any matter permitted under Maryland law. Both the board of directors and the conflicts committee must act upon those conflict-of-interest matters that cannot be delegated to a committee under Maryland law. Our charter also empowers the conflicts committee to retain its own legal and financial advisors. Among the matters we expect the conflicts committee to act upon are:

• the continuation, renewal or enforcement of our agreements with our advisor and its affiliates, including the advisory agreement;

• public offerings of securities;

• sales of real property;

• transactions with affiliates;

• compensation of our officers and directors who are affiliated with our advisor;

• whether and when we seek to list our shares of common stock on a national securities exchange;

• whether and when we seek to become self-managed, which decision could lead to our acquisition of entities affiliated with our advisor;

• whether and when we seek to merge with another entity or enter into a business combination with another entity; and

• whether and when we seek to sell the company or substantially all of its assets.

A majority of our board of directors and a majority of the conflicts committee will approve certain significant proposed multifamily apartment community investments and multifamily real estate-related assets as described above.

Other Charter Provisions Relating to Conflicts of Interests

In addition to the creation of the conflicts committee, our charter contains many other restrictions relating to conflicts of interest including the following:

Advisor Compensation. The conflicts committee will evaluate at least annually whether the compensation that we contract to pay to our advisor and its affiliates is reasonable in relation to the nature and quality of services performed and whether such compensation is within the limits prescribed by the charter. The conflicts committee will supervise the performance of our advisor and its affiliates and the compensation we pay to them to determine whether the provisions of our compensation arrangements are being carried out. This evaluation will be based on the following factors as well as any other factors deemed relevant by the conflicts committee:

• the amount of the fees paid to our advisor in relation to the size, composition and performance of our investments;

• whether the expenses incurred by us are reasonable in light of our investment performance, net assets, net income and the fees and expenses of other comparable unaffiliated REITs;

• the success of our advisor in generating appropriate investment opportunities;

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• the rates charged to other companies, including other REITs, by advisors performing similar services;

• additional revenues realized by our advisor and its affiliates through their relationship with us, including whether we pay them or they are paid by others with whom we do business;

• the quality and extent of service and advice furnished by our advisor and its affiliates;

• the performance of our investment portfolio; and

• the quality of our portfolio relative to the investments generated by our advisor for its own account and for their other clients.

Our charter also requires that any gain from the sale of assets that we may pay our advisor or an entity affiliated with our advisor be reasonable. Such an interest in gain from the sale of assets is presumed reasonable if it does not exceed 15% of the balance of the net sale proceeds remaining after payment to common shareholders, in the aggregate, of an amount equal to 100% of the original issue price of the common stock, plus an amount equal to 6% of the original issue price of the common stock per year cumulative.

Our charter also limits the amount of acquisition fees and acquisition expenses we can incur to a total of 6% of the contract purchase price for the property or, in the case of a loan, 6% of the funds advanced. This limit may only be exceeded if a majority of the directors (including a majority of the members of the conflicts committee) not otherwise interested in the transaction approves the fees and expenses and finds the transaction to be commercially competitive, fair and reasonable to us. Although our charter permits combined acquisition fees and expenses to equal 6% of the purchase price, our advisory agreement limits the contingent acquisition fee to 3% of the purchase price (including any acquisition expenses and any debt attributable to such investments). Any increase in the acquisition fee stipulated in the advisory agreement would require the approval of a majority of the directors (including a majority of the conflicts committee) not otherwise interested in the transaction.

Term of Advisory Agreement. Each contract for the services of our advisor may not exceed one year, although there is no limit on the number of times that we may retain a particular advisor. The conflicts committee or our advisor may terminate our advisory agreement with our advisor without cause or penalty on 60 days’ written notice.

Our Acquisitions.

We will not purchase or lease assets in which our advisor, our sponsor, any of our directors or officers or any of their affiliates has an interest without a determination by a majority of our board of directors (including a majority of the members of the conflicts committee) that such transaction is fair and reasonable to us and at a price to us no greater than the cost of the property to the affiliated seller or lessor, unless there is substantial justification for the excess amount. In no event may we acquire any such real property at an amount in excess of its current appraised value. An appraisal is “current” if obtained within the prior year. If a property with a current appraisal is acquired indirectly from an affiliated seller through the acquisition of securities in an entity that directly or indirectly owns the property, a second appraisal on the value of the securities of the entity shall not be required if (i) the conflicts committee determines that such transaction is fair and reasonable; (ii) the transaction is at a price to us no greater than the cost of the securities to the affiliated seller; (iii) the entity has conducted no business other than the financing, acquisition and ownership of the property; and (iv) the price paid by the entity to acquire the property did not exceed the current appraised value.

Generally, the purchase price that we will pay for any property will be based on the fair market value of the property as determined by a majority of our directors, or the approval of a majority of a committee of the board, provided that the members of the committee approving the transaction would also constitute a majority of the board. In the cases where a majority of our conflicts committee require and in all cases in which the transaction is an acquisition or transfer by or from any of our directors or affiliates, we will obtain an appraisal of fair market value by independent experts selected by our conflicts committee. We may obtain an appraisal in other cases; however, we will rely on our own independent analysis and not on appraisals in determining whether to invest in a particular property. Appraisals are estimates of value and may not always be reliable as measures of true worth or realizable value. We may in the future enter into transactions, including acquisitions, with other programs sponsored by our advisor and its affiliates if an attractive opportunity presents itself and our conflicts committee approves the transaction.

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Mortgage Loans Involving Affiliates. Our charter prohibits us from investing in or making mortgage loans in which the transaction is with our advisor, our directors or officers or any of their affiliates, unless an independent expert appraises the underlying property. We must keep the appraisal for at least five years and make it available for inspection and duplication by any of our shareholders. In addition, we must obtain a mortgagee’s or owner’s title insurance policy or commitment as to the priority of the mortgage or the condition of the title. Our charter prohibits us from making or investing in any mortgage loans that are subordinate to any mortgage or equity interest of our advisor, our directors or officers or any of their affiliates.

Other Transactions Involving Affiliates. A majority of the board of directors (including a majority of the conflicts committee) not otherwise interested in the transaction must conclude that all other transactions, including joint ventures, between us and our sponsor, advisor, any of our officers or directors or any of their affiliates are fair and reasonable to us and on terms and conditions not less favorable to us than those available from unaffiliated third parties and, with respect to joint ventures, on substantially the same terms and conditions as those received by other joint venturers.

Limitation on Operating Expenses. On June 30, 2020, our advisor must reimburse us the amount by which our aggregate total operating expenses for the four fiscal quarters then ended exceed the greater of 2% of our average invested assets or 25% of our net income, unless the conflicts committee has determined that such excess expenses were justified based on unusual and non-recurring factors. “Average invested assets” means the average monthly book value of our assets during the 12-month period before deducting depreciation, bad debts or other non-cash reserves. “Total operating expenses” means all expenses paid or incurred by us that are in any way related to our operation, including advisory fees, but excluding (a) the expenses of raising capital to the extent paid by us such as organization and offering expenses, legal, audit, accounting, underwriting, brokerage, listing, registration and other fees, printing and other such expenses and taxes incurred in connection with the issuance, distribution, transfer, registration and stock exchange listing of our stock; (b) interest payments; (c) taxes; (d) non-cash expenditures such as depreciation, amortization and bad debt reserves; (e) reasonable incentive fees based on the gain from the sale of our assets; and (f) acquisition fees, acquisition expenses (including expenses relating to potential investments that we do not close), disposition fees on the resale of property and other expenses connected with the acquisition, disposition and ownership of real estate interests, loans or other property (other than disposition fees on the sale of assets other than real property), including the costs of foreclosure, insurance premiums, legal services, maintenance, repair and improvement of property.

Issuance of Options and Warrants to Certain Affiliates. Until our shares of common stock are listed on a national securities exchange, we will not issue options or warrants to purchase our capital stock to our advisor, our directors, our sponsor or any of their affiliates, except on the same terms as such options or warrants are sold to the general public. We may issue options or warrants to persons other than our advisor, our directors, our sponsor and their affiliates prior to listing our common stock on a national securities exchange, but not at exercise prices less than the fair market value of the underlying securities on the date of grant and not for consideration (which may include services) that in the judgment of the conflicts committee has a market value less than the value of such option or warrant on the date of grant. Options or warrants issuable to the advisor, a director, the sponsors or any affiliate thereof shall not exceed an amount equal to 10% of the outstanding shares of common stock on the date of grant.

Repurchase of Our Shares. Our charter prohibits us from paying a fee to our sponsor, advisor or our directors or officers or any of their affiliates in connection with our repurchase of our common stock.

Loans. We will not make any loans to the sponsor, our advisor or to our directors or officers or any of their affiliates (other than mortgage loans complying with the limitations described above). In addition, we will not borrow from these affiliates unless a majority of the board of directors (including a majority of the conflicts committee) not otherwise interested in the transaction approves the transaction as being fair, competitive and commercially reasonable and no less favorable to us than comparable loans between unaffiliated parties. These restrictions on loans will only apply to advances of cash that are commonly viewed as loans, as determined by the board of directors. By way of example only, the prohibition on loans would not restrict advances of cash for legal expenses or other costs incurred as a result of any legal action for which indemnification is being sought nor would the prohibition limit our ability to advance reimbursable expenses incurred by directors or officers or our advisor or its affiliates.

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Reports to Shareholders. Our charter requires that we prepare an annual report and deliver it to our common shareholders within 120 days after the end of each fiscal year. Our directors are required to take reasonable steps to ensure that the annual report complies with our charter provisions. Among the matters that must be included in the annual report or included in a proxy statement delivered with the annual report are:

• financial statements prepared in accordance with GAAP that are audited and reported on by independent certified public accountants;

• the ratio of the costs of raising capital during the year to the capital raised;

• the aggregate amount of advisory fees and the aggregate amount of other fees paid to our advisor and any affiliates of our advisor by us or third parties doing business with us during the year;

• our total operating expenses for the year stated as a percentage of our average invested assets and as a percentage of our net income;

• a report from the conflicts committee that our policies are in the best interests of our common shareholders and the basis for such determination; and

• a separately stated, full disclosure of all material terms, factors and circumstances surrounding any and all transactions involving us and our advisor, a director or any affiliate thereof during the year, which disclosure has been examined and commented upon in the report by the conflicts committee with regard to the fairness of such transactions.

Voting of Shares Owned by Affiliates. Our charter provides that none of our advisor, our directors or any affiliate may vote their shares regarding (i) the removal of any of these affiliates or (ii) any transaction between them and us.

Ratification of Charter Provisions.    On June 18, 2018, at the first joint meeting of the board of directors and the conflicts committee, our board of directors and the conflicts committee reviewed and ratified our charter and bylaws by the vote of a majority of their respective members, as required by our charter.

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INVESTMENT OBJECTIVES AND CRITERIA

General

Our investment objectives are to:

• preserve, protect and return invested capital;

• pay stable cash distributions to shareholders;

• realize capital appreciation in the value of our investments over the long term; and

• provide a real estate investment alternative with lower expected volatility relative to public real estate companies whose securities trade daily on a stock exchange.

In general, board of directors may revise our investment policies, without the approval of our shareholders. However, we may not amend our charter, including any investment policies that are provided in our charter and described below under “Investment Objectives and Criteria—Charter-Imposed Investment Limitations” without the concurrence of holders of a majority of the outstanding shares entitled to vote.

Multifamily Focus

We will use the proceeds of this offering to invest directly or indirectly in multifamily apartment communities and multifamily real estate-related assets, including potential development projects, located throughout the United States. We believe that current market dynamics and underlying fundamentals suggest the positive trends in United States multifamily housing will continue. Steady job growth, low unemployment, increased rentership rates, increasing household formation and aligned demographics provide the backdrop for strong renter demand. We believe that other factors impacting the prime United States renter demographic such as delayed major life decisions, increased levels of student debt and tight credit standards in the single-family home mortgage market support the value proposition for owning multifamily apartment communities.

Compelling Long-Term Investment. According to the National Council of Real Estate Investment Fiduciaries (NCREIF) research, since 1977 when NCREIF began tracking returns, the multifamily sector has generated superior returns compared to other major core real estate sectors (see below).

Source: National Council of Real Estate Investment Fiduciaries. Information as of December 31, 2018. Our sponsor created all graphs and calculations based on the referenced data.

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Only three of those years produced negative returns, while sector volatility remained lower relative to the average of other core sectors. Further, real estate total returns, and specifically private real estate, have historically displayed a low correlation to stocks and bonds, serving as a meaningful diversifier to portfolios. As such, we believe the multifamily sector provides attractive risk-adjusted return prospects relative to other core real estate sectors.

			Last 10 Years
Index	Notes		Correlation to Private Multifamily Real Estate
Private Multifamily Real Estate		1		1.00
Public U.S. Multifamily Real Estate		2		0.10
Public U.S. Real Estate		3		0.05
Public Real Estate (Excluding U.S.)		4		-0.13
Public Equities		5		0.01
Corporate Bonds		6		-0.01
Hedge Funds		7		-0.21

Sources: Bloomberg, NAREIT, NCREIF and S&P Global Market Intelligence. Our sponsor performed all calculations based on the referenced data.

Notes: As of December 31, 2018.

1) Private Multifamily Real Estate is represented by the NCREIF Property Index—Apartments Only.

2) Public U.S. Multifamily Real Estate is represented by the FTSE Nareit Equity Apartments total return index series.

3) Public U.S. Real Estate is represented by the FTSE Nareit All-Equity REITs total return index series.

4) Public Real Estate (Excluding U.S.) is represented by FTSE EPRA/Developed Ex-U.S. Index.

5) Public Equities is represented by the S&P 500 Total Returns Index.

6) Corporate Bonds is represented by the Barclays U.S. Aggregate Bond Index.

7) Hedge Funds is represented by the Dow Jones Credit Suisse Hedge Fund Index.

Sustained Growth in Prime Renter Population. According to United States Census Bureau data, individuals under the age of 35 have the highest rentership rate with 64% renting rather than owning their homes (see below).

Source: U.S. Census Bureau: Table 12a. Annual Estimates of the Housing Inventory by Age of Householder. Information as of December 31, 2018. Our sponsor created all graphs and calculations based on the referenced data.

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Moreover, while this age group has a higher propensity to rent, United States Census Bureau data shows that the rentership rates for all age groups, other than those under age 25 who showed a higher propensity to move in with parents, increased from 2010 to 2018 (see below).

Source: U.S. Census Bureau: Table 12a. Annual Estimates of the Housing Inventory by Age of Householder. Information as of December 31, 2018. Our sponsor created all graphs and calculations based on the referenced data.

We also believe that favorable demographic trends under way will result in an increased demand for apartment housing. The echo-boom generation (commonly known as the “Millennial” generation; generally those born in the 1980s or 1990s) continues to enter the labor force, obtain their own housing for the first time and are members of the 20 to 34 years-old age group, the predominant renter age range (see below). Until 2024, it is expected that the individuals entering the prime renter demographic (ages 20 to 34) will outnumber those that are exiting the demographic.

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Source: U.S. Census Bureau: Population Estimates (United States Residents Population ages 20 – 24, 25 – 29 and 30- 34); and 2017 National Population Projections (Table 1. Projected Population by Single Year of Age, Sex, Race, and Hispanic Origin for the United States: 2016 to 2060). Information as of December 31, 2018. Our sponsor created all graphs and calculations based on the referenced data.

Increased Rentership Rates and Household Formation. According to United States Census Bureau data, the United States rentership rate has steadily increased from historically low rates in the mid-2000’s. Since hitting a low of 31% in 2004, the rentership rate has increased to approximately 36% as of 2018. The recession most notably impacted household formation in the prime renter demographic.

Source: U.S. Census Bureau: Table 14. Quarterly Homeownership Rates for the U.S. and Regions: 1964 to Present. Information as of December 31, 2018. Our sponsor created all graphs and calculations based on the referenced data.

From the early 1980s until the Great Recession in 2008, on average 11.4% of young adults aged 25 to 34 lived with their parents. By 2018, the number of young adults in that age group living with parents increased to 16.8%. This population of young adults likely represents additional pent up demand for multifamily housing as these individuals begin to move out and create households.

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Source: U.S. Census Bureau: Table AD-1. Young Adults, 18-34 Years Old, Living At Home: 1960 to Present. Information as of December 31, 2018. Our sponsor created all graphs and calculations based on the referenced data.

Convenience of Apartment Living and Costs of Homeownership. Many households choose to rent given maintenance costs and other burdens associated with homeownership. In addition, the ability to vary location and the lease terms associated with renting provides flexibility that appeals to many households, particularly those in younger groups who prioritize mobility. During the current economic recovery, the ratio of median new home sale prices to median household incomes in the U.S. rose to it’s highest level in the last 40+ years to 5.4x in 2014, while still remaining at levels exceeding 5 times median household incomes. Data from the Bureau of Labor Statistics and Federal Housing Finance Agency show that since 1990, the house price index has risen 24% higher than that of the owner’s equivalent rent; suggesting that the cost of purchasing a home has outpaced increases in rent. Increases in interest rates could put affordability even more out of reach for many individuals. These trends place continued constraints on the ability of new households to purchase homes, and we believe support sustained demand for multifamily housing.

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Source: U.S. Census Bureau: Median and Average Sale Price of Houses Sold; and Table H-6. Regions-by Median and Mean Income. Information as of December 31, 2017. Our sponsor created all graphs and calculations based on the referenced data.

Sources: Federal Housing Finance Agency: U.S. and Census Division (Seasonally Adjusted and Unadjusted) January 1991—Latest Month; and Bureau of Labor Statistics: Owner’s Equivalent Rent of Residences in U.S. Information as of December 31, 2018. Our sponsor created all graphs and calculations based on the referenced data.

Tightened Mortgage Credit Standards and Historically High Student Debt Levels. Heightened lender underwriting standards for home purchases and the increased burden of student debt should continue to drive demand for apartments. Since the end of the Great Recession, the average mortgage origination volume to sub-660 credit scores declined to 8.6% annually (down significantly from 24.0% at its peak in 2006). Furthermore, student debt levels have ballooned by more than 475% over the last 15 years, while 90+ day delinquencies have nearly doubled, creating further pressure on young adults to remain as renters.

Source: Federal Reserve Bank of New York: Quarterly Report on Household Debt and Credit, Data Underlying Report. Information as of December 31, 2018. Our sponsor created all graphs and calculations based on the referenced data.

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Source: Federal Reserve Bank of New York: Quarterly Report on Household Debt and Credit, Data Underlying Report. Information as of December 31, 2018. Our sponsor created all graphs and calculations based on the referenced data.

Delayed Major Life Decisions. The secular trend of delaying certain major life decisions should strengthen demand for multifamily housing. The decision to marry or have children traditionally has pushed families towards purchasing a home. The average age of these major life events, male first marriage, female first marriage and female first child, have increased since the Great Recession from 27.5, 25.6, and 25.0, respectively, in 2007 to 29.5, 27.4 and 26.8, respectively, in 2017.

Sources: U.S. Census Bureau: Table MS-2. Estimated Median Age at First Marriage, by Sex: 1890 to the Present; Organisation for Economic Co-operation and Development: SF2.3 Age of mothers at childbirth and age-specific fertility; and Centers for Disease Control and Prevention: Table 1-6. Mean Age of Mother by Live-birth Order, According to Race and Hispanic Origin of Mother: United States, 1968-2003. Information as of December 31, 2017. Our sponsor created all graphs and calculations based on the referenced data.

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Post-recession Shortage of Residential Housing Supply. According to Census data, from 2010 to 2018, the United States housing market delivered 7.2 million new housing units compared to 9.2 million net new households created. There has been asymmetric delivery of supply across the U.S. resulting in some markets experiencing the early stages of oversupply, however, there remain several U.S. housing markets, and submarkets, with supply shortages that should deliver better than average rent growth due to supply constraints and high regulatory and/or capital markets barriers to new supply.

Source: U.S. Census Bureau: Table 7a. Annual Estimates of the Housing Inventory; and Table 13a. Monthly Household Estimates. Information as of December 31, 2018. Our sponsor created all graphs and calculations based on the referenced data.

Robust Rental Growth Driven by Correlation to Job Market. Continued job growth across an increasingly diverse group of sectors and regions of the United States should contribute to notable growth in rental rates. Since 1997, non-agricultural employment has grown 1.0% per year, while effective rents have grown 2.6% per year (on average).

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Sources: Bureau of Labor Statistics: Labor Force Statistics from the Current Population Survey, Average annual data; and Axiometrics: Annual National Trend Report. Information as of December 31, 2018. Our sponsor created all graphs and calculations based on the referenced data.

As shown in the table below, there is a strong correlation between rent growth and non-agricultural job growth.

Sources: Bureau of Labor Statistics: Labor Force Statistics from the Current Population Survey, Average annual data; and Axiometrics: Annual National Trend Report. Information as of December 31, 2018. Our sponsor created all graphs and calculations based on the referenced data.

Investment Portfolio

Expected Portfolio Structure. Our primary investment vehicle is the operating partnership. In certain circumstances, we may acquire assets through joint ventures, mergers or other types of business combinations. The investments will be comprised primarily of stabilized multifamily apartment communities and land which will be

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developed into multifamily apartment communities. The strategy may also include mortgage and mezzanine loans to, or preferred equity investments in, entities that have been formed for the purpose of acquiring or developing multifamily apartment communities. We seek to acquire, develop and actively manage these investments, with the objective of providing a stable source of income for our shareholders and maximizing potential returns upon disposition of the assets through capital appreciation. Generally, proceeds from the sale, financing or disposition of investments will be reinvested in a manner consistent with our investment strategy, although such proceeds may be distributed to the shareholders in order to comply with REIT requirements.

Most transactions will be pursuant to purchase and sale agreements. However, we may also enter into contribution agreements whereby a holder of real estate desires to exchange the real estate for limited partner units in the operating partnership. If this occurs, we will amend the partnership agreement of our operating partnership.

Portfolio Allocation Targets. We seek to invest at least 65% of our assets in stabilized multifamily apartment communities and up to 35% in mortgage loans, preferred equity investments, mezzanine loans or equity investments in a property or land which will be developed into a multifamily apartment community (including, by way of example, an existing multifamily apartment community that may require redevelopment capital for strategic repositioning within its market). We do not expect to be able to achieve the balance of these allocations until we have raised substantial proceeds in this offering. Prior to that time, we will balance the goal of achieving our portfolio allocation targets with the goal of carefully evaluating and selecting investment opportunities to maximize risk-adjusted returns. Notwithstanding the foregoing, the actual portfolio allocation may from time to time be outside the target levels provided above due to factors such as a large inflow of capital over a short period of time, the advisor’s or board of directors’ assessment of the relative attractiveness of opportunities, an increase or decrease in the relative value of an investment or limitations or requirements relating to our intention to be treated as a REIT for U.S. federal income tax purposes. Furthermore, our board of directors may revise the targeted portfolio allocation from time to time, if it determines that a different portfolio composition is in our shareholders’ best interests.

Portfolio Location and Operations. We target properties located in major metropolitan areas in the United States that have, in the opinion of the advisor and our board of directors, attractive investment dynamics for multifamily apartment owners. We do not designate specific geographic allocations for the portfolio. Our advisor targets regions where it sees the best opportunities that support our investment objectives and attempts to acquire multifamily apartment communities in diverse locations so that we are not overly concentrated in a single area (though we are not precluded from owning multiple properties in a particular area). We have engaged Cottonwood Communities Management, LLC to manage our multifamily apartment communities and provide other related services.

Investment Philosophy and Life-Cycle

Investment Philosophy and Selection Process. Our advisor operates pursuant to a philosophy that location, investment time horizon, asset-specific attributes and appropriate leverage are fundamental drivers of long-term value creation in real estate. These principles drive the material aspects of our advisor’s investment decision-making process.

Location. From a geographic perspective, we have the competitive advantage of flexibility: we may invest where our advisor identifies unique opportunities, market dislocation or mispriced assets. Our Advisor generally targets investment locations with enduring value and high barriers to entry (such as time-consuming regulatory hurdles for new construction), and where minimal competitive supply is planned or under construction and there exist opportunities to buy assets below replacement cost. Buying an asset

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below replacement cost offers a margin of safety for property owners, typically, ensuring that no new construction will be completed until values rise to justify new (competing) product. Our advisor also seeks to anticipate broader market capital flows and invest where economic growth is expected to drive resident demand but new supply is not yet on the horizon. Additional investment location considerations by our advisor include:

• Local Industry and Employment. Certain employment sectors, such as financial services, information technology and healthcare, are better-positioned for higher employee earnings potential, enhancing price elasticity of rents.

• Demographics. Locations with a higher concentration of the prime renter demographic with above average incomes will drive increased demand for renting apartments.

• Infill Locations. Sites within markets or sub-markets undergoing redevelopment programs, land recycling initiatives or that generally exhibit high barrier to entry characteristics offer, in the opinion of the advisor, better investment prospects over the long run.

• Accessibility to Key Attractions. Focus on local block-by-block details (the sub-market within a sub-market) during the investment selection process, including walkability scores, public transportation, crime rates, projected employment growth and access to popular dining, entertainment and retail venues as well as sought after school districts.

Time Horizon. Our portfolio will generally consist of illiquid real estate investments. Though we expect the average holding period for our stabilized operating assets to be between five and ten years, an asset within our investment portfolio may experience short-term fluctuations in value. Nonetheless, our advisor believes purchasing and holding assets in enduring locations will ultimately create long-term value and capital appreciation. Our structure allows us to hold assets for periods of time sufficient to withstand short-term market volatility.

Asset-Specific Attributes. The management team of our advisor has extensive experience investing in, and managing institutional multifamily apartment communities. The advisor investigates each investment opportunity in the context of comparable communities to assess relative market position, functionality, suite of amenity offerings, unit-specific features and obsolescence. Site inspections are an important aspect of the advisor’s underwriting process. For example, under-managed or under-capitalized assets represent a unique investment opportunity to stabilize and/or refurbish the community to maximize operating performance and long-term value.

Leverage. Downside risk of short-term fluctuations in market values or cash flow can be mitigated by using appropriately conservative leverage policies. Excess leverage during market corrections often result in property owners being forced to sell or liquidate assets at inopportune times. We expect to finance the purchase of our stabilized multifamily apartment communities using a loan-to-cost or loan-to-value ratio of 45% to 65% at the REIT level.

Due Diligence Process. Once a potential investment has been identified, our advisor will engage in a rigorous due diligence process. Although due diligence procedures are customized for specific elements of each deal, our advisor will follow traditional due diligence processes (physical, market, financial, environmental, zoning, insurance, tax, legal, etc.) in considering investments for us. Our advisor may outsource certain due diligence items to specialized consultants or third-party service providers, as needed, to support the diligence effort. Our advisor’s diligence focuses on three customary areas:

Financial Due Diligence. A preliminary review of each investment opportunity will be conducted in order to screen the attractiveness of each transaction. The preliminary review is followed by an initial projection based on macro- and micro-economic analyses. Projection assumptions are developed from analysis of historical operating performance, communications with management, and analysis of research reports generated from real estate brokerage firms, investment banks, consultants and other pertinent resources. The advisor will also leverage a broad network of contacts in developing investment projections, such as strategic partners, local developers, appraisers, industry experts, third-party consultants, outside counsel, accountants and tax advisors. As necessary, third-party accounting consultants may be used to review relevant books and records, confirm cash flow information provided by a seller and conduct other similar types of analysis.

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Physical Due Diligence. The advisor will hire third-party consultants, as necessary, to prepare reports on environmental and engineering matters. Conclusions from such consultants’ reports may influence the financial projections for an investment or lead the advisor to terminate the pursuit of an investment. Our advisor and/or property manager will also spend time in the surrounding market and visit competitive properties to better understand market dynamics.

Legal and Tax Due Diligence. The advisor will work closely with outside counsel to review diligence materials and negotiate applicable legal and property specific documents pertaining to any investment opportunity. The scope of legal and tax diligence will be broad and include (as appropriate) review of property title and survey, existing and/or new loan documents, leases, management agreements and purchase contracts. Additionally, the advisor will work with tax advisors to structure investments in an efficient manner.

Financing Strategy. We intend to finance the purchase of multifamily apartment communities with proceeds of this offering and loans obtained from third-party lenders. We anticipate the use of moderate leverage to enhance total cash flow to our shareholders. We target an aggregate loan-to-cost or loan-to-value ratio of 45% to 65% at the REIT level; provided, however, that we may obtain financing that is less than or exceeds such ratio in the discretion of our board of directors if the board of directors deems it to be in our best interest to obtain such financing. Although there is no limit on the amount we can borrow to acquire a single real estate investment, we may not leverage our assets with debt financing such that our borrowings are in excess of 300% of our net assets, unless a majority of our conflicts committee finds substantial justification for borrowing a greater amount and such excess borrowings are disclosed in our next quarterly report, along with the conflicts committee’s justification for such excess. Examples of such a substantial justification include obtaining funds for the following: (i) to repay existing obligations, (ii) to pay sufficient distributions to maintain REIT status, or (iii) to buy an asset where an exceptional acquisition opportunity presents itself and the terms of the debt agreement and the nature of the asset are such that the debt does not increase the risk that we would become unable to meet our financial obligations as they became due. We anticipate that all financing obtained to acquire stabilized multifamily apartment communities will be non-recourse to our operating partnership and us (however, it is possible that some of these loans will require us to enter into guaranties with respect to certain non-recourse carve-outs). We may obtain recourse debt in connection with certain development transactions.

We may obtain a line of credit or other financing that will be secured by one or more of our assets. We may use the proceeds from any line of credit or financing to bridge the acquisition of, or acquire, multifamily apartment communities and multifamily real estate-related assets if our board of directors determines that we require such funds to acquire the multifamily apartment communities or real estate-related assets.

Asset and Property Management; Operations. The advisor directly oversees the asset management of our investment portfolio. Our advisor’s responsibilities include strategic asset management initiatives such as capital enhancing projects and/or repositioning of an investment, identification of asset or portfolio-level risks or opportunities and the dedication of appropriate resources for potentially underperforming investments. The advisor’s role as asset manager serves as a risk-management control function, helping diagnose problems or identify opportunities at an early stage and develop creative solutions to focus attention where it is needed most.

The advisor works closely with our property manager(s) to oversee day-to-day operations of our stabilized operating communities. Our property manager(s) assists our advisor in developing and aggregating community-level projections, pricing strategies, marketing campaigns and expense management initiatives, and synthesizing data into management reports and analysis to streamline the management of our investment portfolio and financial reporting.

Exit Strategies and Disposition Process. Our advisor underwrites long-term hold periods for our investments (generally, five to ten years for stabilized operating communities and equity investments in developments, and three to four years for preferred equity or mezzanine debt investments). Our advisor seeks to avoid investment return profiles for stabilized multifamily apartment communities that depend primarily on significant appreciation, and evaluates development opportunities that align with the overall strategic objectives of our business. We believe that holding our target assets for a long period of time will enable us to execute our business plan, generate stable cash-on-cash returns and drive long-term cash flow and net asset value growth.

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From time to time, at the discretion of our board of directors and advisor, we may elect to sell an investment before the end of its underwritten hold period if our advisor believes that will maximize value for us. Our advisor and property manager closely monitor market conditions and any decision to sell an investment (earlier or later than, or in-line with, underwritten expectations) will depend on a variety of factors. For example, the hold period may be influenced by events such as an anticipated change in the regulatory landscape in the jurisdiction in which the investment is located or an unfavorable expected shift in the investment’s sub-market that may limit future potential upside for the investment. Similarly, the current value or status of the investment’s business plan may influence an investment’s hold period. For example, the advisor may consider current market values relative to underwritten values as well as the opportunity cost of selling the investment immediately or holding the investment for a longer period of time relative to the status of any value creation plan that was established at acquisition.

Upon making the decision to sell an individual asset, portfolio of assets or the entire investment portfolio, our advisor generally believes that a broadly marketed sale through appropriate channels will maximize value for our shareholders. However, in the board of directors’ and advisor’s discretion, the advisor may pursue a one-off or private sale where it is believed that such execution will result in a more favorable outcome for us. In situations where we select a third-party brokerage firm to market an asset, our advisor will endeavor to select the best-in-class firm in order to maximize value for us.

We currently anticipate holding and managing our investments until August 13, 2028 at the latest. Our charter requires that if we do not list our shares of common stock on a national securities exchange by August 13, 2028, we must either seek shareholder approval of the liquidation of the company; or postpone the decision of whether to liquidate the company if a majority of the board of directors determines that liquidation is not then in the best interests of our shareholders.

We are not, however, required to provide our shareholders a liquidity event by a specified date or at all. If a majority of the board of directors does determine that liquidation is not then in the best interests of our shareholders, our charter requires that the board of directors revisit the issue of liquidation at least annually. Further postponement of listing or shareholder action regarding liquidation would only be permitted if a majority of the board of directors again determined that liquidation would not be in the best interest of our shareholders. If we sought and failed to obtain shareholder approval of our liquidation, our charter would not require us to list or liquidate and would not require the board of directors to revisit the issue of liquidation, and we could continue to operate as before. If we sought and obtained shareholder approval of our liquidation, we would begin an orderly sale of our assets. The precise timing of such sales would take into account the prevailing real estate and finance markets, the economic conditions in the submarkets where our properties are located and the debt markets generally as well as the federal income tax consequences to our shareholders.

Charter-Imposed Investment Limitations

Our charter places numerous limitations on us with respect to the manner in which we may invest our funds or issue securities. Pursuant to our charter, we will not:

• invest more than 10% of our total assets in unimproved property or mortgage loans on unimproved property, which we define as property not acquired for the purpose of producing rental or other operating income or on which there is no development or construction in progress or planned to commence within one year;

• make or invest in mortgage loans unless an appraisal is available concerning the underlying property, except for those mortgage loans insured or guaranteed by a government or government agency;

• make or invest in mortgage loans, including construction loans, on any one property if the aggregate amount of all mortgage loans on such property would exceed an amount equal to 85% of the appraised value of such property as determined by appraisal, unless substantial justification exists for exceeding such limit because of the presence of other underwriting criteria;

• make an investment if the related acquisition fees and expenses are not reasonable or exceed 6% of the contract purchase price for the asset, provided that the investment may be made if a majority of the directors (including a majority of the members of the conflicts committee) not otherwise interested in the transaction determines that the transaction is commercially competitive, fair and reasonable to us;

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• acquire equity securities unless a majority of our directors (including a majority of the members of our conflicts committee) not otherwise interested in the transaction approve such investment as being fair, competitive and commercially reasonable, provided that investments in equity securities in “publicly traded entities” that are otherwise approved by a majority of our directors (including a majority of the members of our conflicts committee) shall be deemed fair, competitive and commercially reasonable if we acquire the equity securities through a trade that is effected in a recognized securities market (a “publicly traded entity” shall mean any entity having securities listed on a national securities exchange or included for quotation on an inter-dealer quotation system) and provided further that this limitation does not apply to (i) acquisitions effected through the purchase of all of the equity securities of an existing entity, (ii) the investment in wholly owned subsidiaries of ours or (iii) investments in asset-backed securities;

• invest in real estate contracts of sale, otherwise known as land sale contracts, unless the contract is in recordable form and is appropriately recorded in the chain of title;

• invest in commodities or commodity futures contracts, except for futures contracts when used solely for the purpose of hedging in connection with our ordinary business of investing in real estate assets and mortgages;

• issue equity securities on a deferred payment basis or other similar arrangement;

• issue debt securities in the absence of adequate cash flow to cover debt service unless the historical debt service coverage (in the most recently completed fiscal year), as adjusted for known changes, is sufficient to service that higher level of debt as determined by the board of directors or a duly authorized executive officer;

• issue equity securities that are assessable after we have received the consideration for which our board of directors authorized their issuance;

• issue redeemable equity securities (as defined in the Investment Company Act), which restriction has no effect on our share repurchase program or the ability of our operating partnership to issue redeemable partnership interests; or

• make distributions in kind, except for distributions of readily marketable securities, distributions of beneficial interests in a liquidating trust established for our dissolution and the liquidation of our assets in accordance with the terms of our charter or distributions that meet all of the following conditions: (a) our board of directors advises each shareholder of the risks associated with direct ownership of the property, (b) our board of directors offers each shareholder the election of receiving such in kind distributions and (c) in kind distributions are made only to those shareholders who accept such offer.

In addition, our charter includes many other investment limitations in connection with conflict-of-interest transactions, which limitations are described above under “Conflicts of Interest.” Our charter also includes restrictions on roll-up transactions, which are described under “Description of Shares.”

Investment Limitations under the Investment Company Act of 1940

We intend to conduct our operations so that neither we nor any of our subsidiaries will be required to register as an investment company under the Investment Company Act. Under the relevant provisions of Section 3(a)(1) of the Investment Company Act, an investment company is any issuer that:

• pursuant to Section 3(a)(1)(A), is or holds itself out as being engaged primarily, or proposes to engage primarily, in the business of investing, reinvesting or trading in securities (the “primarily engaged test”); or

• pursuant to Section 3(a)(1)(C), is engaged or proposes to engage in the business of investing, reinvesting, owning, holding or trading in securities and owns or proposes to acquire “investment securities” having a value exceeding 40% of the value of such issuer’s total assets (exclusive of United States government securities and cash items) on an unconsolidated basis (the “40% test”). “Investment securities” excludes United States government securities and securities of majority-owned subsidiaries that are not themselves investment companies and are not relying on the exception from the definition of investment company under Section 3(c)(1) or Section 3(c)(7) (relating to private investment companies).

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Neither we nor our Operating Partnership should be required to register as an investment company under either of the tests above. With respect to the 40% test, most of the entities through which we and our Operating Partnership will own our assets will be majority-owned subsidiaries that will not themselves be investment companies and will not be relying on the exceptions from the definition of investment company under Section 3(c)(1) or Section 3(c)(7) (relating to private investment companies).

With respect to the primarily engaged test, we and our Operating Partnership will be holding companies and do not intend to invest or trade in securities ourselves. Rather, through the majority-owned subsidiaries of our Operating Partnership, we and our Operating Partnership will be primarily engaged in the non-investment company businesses of these subsidiaries, namely the business of purchasing or otherwise acquiring real estate and real estate-related assets.

If any of the subsidiaries of our Operating Partnership fail to meet the 40% test, then we believe they will often be able to rely on Section 3(c)(5)(C) of the Investment Company Act for an exception from the definition of an investment company. As reflected in no-action letters, the SEC staff’s position on Section 3(c)(5)(C) generally requires that an issuer maintain at least 55% of its assets in “mortgages and other liens on and interests in real estate” or qualifying assets; at least 80% of its assets in qualifying assets plus real estate-related assets; and no more than 20% of the value of its assets in other than qualifying assets and real estate-related assets. To constitute a qualifying asset under this 55% requirement, a real estate interest must meet various criteria based on no-action letters. We expect that any of the subsidiaries of our Operating Partnership relying on Section 3(c)(5)(C) will invest at least 55% of its assets in qualifying assets, with substantially all of its remaining assets in other types of real estate-related assets. If any subsidiary relies on Section 3(c)(5)(C), then we expect to rely on guidance published by the SEC staff or on our analyses of guidance published with respect to types of assets to determine which assets are qualifying real estate assets and real estate-related assets.

Pursuant to the language of Section 3(c)(5)(C), we will treat an investment in real property as a qualifying real estate asset. In reliance on SEC staff published guidance, we take the view that certain mortgage loans, participations, mezzanine loans, convertible mortgages, and other types of real estate related loans in which we intend to invest are qualifying real estate assets. Thus, we intend to treat these investments as qualifying real estate assets.

If any subsidiary relies on Section 3(c)(5)(C), we expect to limit the investments that the subsidiary makes, directly or indirectly, in assets that are not qualifying assets and in assets that are not real estate-related assets. In 2011, the SEC issued a concept release indicating that the SEC and its staff were reviewing interpretive issues relating to Section 3(c)(5)(C) and soliciting views on the application of Section 3(c)(5)(C) to companies engaged in the business of acquiring mortgages and mortgage related instruments. To the extent that the SEC or its staff provides guidance regarding any of the matters bearing upon the exceptions we and our subsidiaries rely on from registration as an investment company, we may be required to adjust our strategy accordingly. Any guidance from the SEC or its staff could further inhibit our ability to pursue the strategies we have chosen.

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PRIOR PERFORMANCE SUMMARY

The information presented in this section represents the historical experience of real estate programs, which we refer to as “prior real estate programs,” sponsored by Cottonwood Residential Inc., Cottonwood Residential O.P., LP and their affiliates. The following summary is qualified in its entirety by reference to the Prior Performance Tables, which may be found in Appendix C of this prospectus. Investors in our shares should not assume that they will experience returns, if any, comparable to those experienced by investors in the prior real estate programs. Investors who purchase our shares will not thereby acquire any ownership interest in any of the entities to which the following information relates.

Experience and Background of Cottonwood Residential O.P., LP

Our advisor, CC Advisors III, LLC, is a recently formed affiliate of Cottonwood Residential O.P., LP. Prior to September 2018, Cottonwood Residential, Inc., formed on September 24, 2009, was the sole general partner of Cottonwood Residential O.P., LP. Cottonwood Residential II, Inc. was added as a general partner of Cottonwood Residential O.P., LP following a decision by Cottonwood Residential, Inc. to commence a plan to liquidate and restructure its subsidiaries, including Cottonwood Residential O.P., LP.

Cottonwood Residential, Inc. did all of its investing through Cottonwood Residential O.P., LP, its operating partnership. Following the implementation of Cottonwood Residential, Inc.’s plan to liquidate and the admission of Cottonwood Residential II, Inc. as a general partner of Cottonwood Residential O.P., LP, Cottonwood Residential II, Inc. will manage the investing activities of Cottonwood Residential O.P., LP. Since Cottonwood Residential O.P., LP’s formation in 2009, Cottonwood Residential O.P., LP, has grown into an industry-leading, fully integrated, national multifamily platform. As of December 31, 2018, Cottonwood Residential O.P., LP provides property and asset management services to a platform of multifamily assets representing approximately 15,300 multifamily apartment units across 13 states with over $2.0 billion in value.

Cottonwood Residential O.P., LP also has a significant investment platform, holding ownership interests in 29 multifamily apartment communities and other related assets, 25 properties of which represent approximately 7,200 existing units, and 4 properties under development which represent approximately 1,000 additional units, all of which account for approximately $950.0 million in total gross asset value as of December 31, 2018. Since the formation of Cottonwood Residential, Inc.’s and Cottonwood Residential O.P., LP’s investment platform in 2009, Cottonwood Residential, Inc. and Cottonwood Residential O.P., LP have secured capital commitments through contributions by direct property owners, broker-dealer networks and institutional investors totaling over $700 million.

Cottonwood Residential O.P., LP secured a $127 million commitment in 2011 and an additional $25 million commitment in 2014 from affiliates of FrontRange Capital Partners and Equity Resource Investments to capitalize on attractive multifamily investment opportunities within its managed platform. In addition, in 2015, Cottonwood Residential, Inc. secured an additional $52.5 million debt commitment and $52.5 million equity commitment from Equity Resource Investments. In 2018, Cottonwood Residential O.P., LP repaid all of the outstanding debt and equity investments made by FrontRange Capital Partners and Equity Resource Investments.

Prior Performance of Cottonwood Residential, Inc., Cottonwood Residential O.P., LP and their Affiliates

Cottonwood Residential O.P., LP has become the manager of 11 limited liability companies which were formed to accept the contribution of tenant in common interests in multifamily apartment communities formerly owned by tenant in common owners or which were converted from Delaware statutory trusts. These limited liability companies accepted the contribution of undivided interests in real estate in exchange for limited liability company interests. Approximately 76 investors participated in these limited liability companies. All of the limited liability companies acquired multifamily apartment communities, of which eight were located in the southeastern United States, two were located in the southwestern United States and one was located in the northwestern United States. All of the properties were previously owned. As of December 31, 2018, six of the properties have been sold.

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Cottonwood Residential O.P., LP also sponsored the formation of two tenant in common structures. One of these programs was formed in 2015 to acquire a property located in Buford, GA with one investor who contributed approximately $9M to acquire a 20% interest in the property. During 2018, Cottonwood Residential O.P., LP acquired this investor’s interest in the property and now owns 98.7% of the property. The other program was formed in 2017 to acquire a property located in St. Petersburg, FL with two investors who contributed approximately $23M to acquire a 79.5% equity interest in the property. The property had previously been 100% owned by Cottonwood Residential O.P., LP.

Cottonwood Capital Property Management II, LLC, a wholly owned subsidiary of Cottonwood Residential O.P., LP, sponsored Cottonwood Multifamily REIT I, Inc. Cottonwood Multifamily REIT I, Inc. conducted a $50,000,000 offering that was qualified as a “Tier 2” offering pursuant to Regulation A promulgated under the Securities Act from May 2016 through April 2017, raising the full offering amount from approximately 1,300 investors. It has acquired interests in three multifamily apartment communities, one located in Florida, one located in North Carolina and one located in Georgia. The total purchase price for the portion of the properties acquired by Cottonwood Multifamily REIT I, Inc. was approximately $126,796,500. The properties were acquired using permanent financing in the amount of approximately $89,900,000 (of which $80,910,000 is allocable to Cottonwood Multifamily REIT I, Inc.’s interest in the properties). Cottonwood Multifamily REIT I, Inc. reached the minimum offering amount on September 2, 2016 and has made daily distributions in the amount of $0.001571038 per day since that time. Distributions have been paid each month beginning October 2016. See Appendix C, Table I for more information on this offering.

Cottonwood Capital Property Management II, LLC, a wholly owned subsidiary of Cottonwood Residential O.P., LP also sponsored Cottonwood Multifamily REIT II, Inc. Cottonwood Multifamily REIT II, Inc. conducted a $50,000,000 offering that was qualified as a “Tier 2” offering pursuant to Regulation A promulgated under the Securities Act from July 2017 through August 2018, raising the full offering amount from approximately 1,100 investors. It has acquired interests in two multifamily apartment communities, one located in Massachusetts, and one located in North Carolina. The total purchase price for the portion of the properties acquired by Cottonwood Multifamily REIT II, Inc. was approximately $100,177,000. The properties were acquired using permanent financing in the amount of approximately $71,760,000 (of which approximately $54,834,000 is allocable to Cottonwood Multifamily REIT II, Inc.’s interest in the properties). Cottonwood Multifamily REIT II, Inc. reached its minimum offering amount on September 27, 2017 and has made daily distributions in the amount of $0.0014383562 per day since that time. Distributions have been paid each month beginning October 2017. See Appendix C, Table I for more information on this offering.

Cottonwood Capital Property Management II, LLC, a wholly owned subsidiary of Cottonwood Residential O.P., LP, also sponsored Cottonwood Multifamily Opportunity Fund, Inc. Cottonwood Multifamily Opportunity Fund, Inc. launched its $50.0 million offering in November 2017 and as of the date of the prospectus its offering is fully subscribed. It has made an initial investment in a development project for a multifamily apartment community.

The following table sets forth information regarding these 11 limited liability companies, two tenant in common transactions, Cottonwood Multifamily REIT I, Inc., Cottonwood Multifamily REIT II, Inc. and Cottonwood Multifamily Opportunity Fund, Inc.

Name of Program	Type of Program	Launch Year	Program Status
Pavilions	Limited Liability Company	2011	Operating
Lily Flagg	Limited Liability Company	2011	Closed/Sold
Waterford Creek	Limited Liability Company	2012	Closed/Sold
Appling Lakes	Limited Liability Company	2012	Closed/Sold
Midtown Crossing	Limited Liability Company	2013	Closed/Sold
Brook Highland Place	Limited Liability Company	2013	Closed/Sold
Toscana	Limited Liability Company	2015	Operating
Scott Mountain	Limited Liability Company	2015	Operating
Courtney Oaks	Limited Liability Company	2015	Operating
Sanctuary	Limited Liability Company	2015	Closed/Sold
Summer Park	Tenant in Common	2015	Closed
Arbors at Fairview	Limited Liability Company	2016	Closed/Sold
Cottonwood Multifamily REIT I, Inc.	REIT	2016	Operating
Cottonwood Multifamily REIT II, Inc.	REIT	2017	Operating
Cottonwood Bayview	Tenant in Common	2017	Operating
Cottonwood Multifamily Opportunity Fund, Inc.	REIT	2017	Operating

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Neither Cottonwood Residential, Inc., nor Cottonwood Residential O.P., LP, nor their affiliates have sponsored any prior public programs that disclosed a liquidity event date. See Appendix C, Table III, Annual Operating Results of Prior Real Estate Programs for information regarding the last five programs sponsored by Cottonwood Residential O.P., LP.

Cottonwood Capital, LLC, which became a subsidiary of Cottonwood Residential O.P., LP in 2011, was formed in 2005 for the purpose of offering tenant in common interests in multifamily residential apartment communities. Cottonwood Capital, LLC or its affiliates sponsored 17 tenants in common programs. These prior tenants in common programs raised more than $157 million from over 419 investors. Purchasers who participated in more than one prior tenant in common program were counted as an investor for each such program. The tenant in common programs purchased 17 properties for an aggregate purchase price of more than $412 million, of which 4 were located in the southeastern United States, 9 were located in the southwestern United States, 1 was located in the northwestern United States and 3 were located in the western United States. All of the properties were previously owned. All of the properties were multifamily residential properties. Of these 17 programs, 13 have been sold as of December 31, 2018. The following table sets forth information regarding the 17 tenants in common programs.

Name of Program	Type of Program	Launch Year	Program Status
Northwest Corners	Tenant in Common	2005	Closed/Sold
Scott Mountain	Tenant in Common	2005	Closed
Tramore Village	Tenant in Common	2005	Closed/Sold
Camelot	Tenant in Common	2006	Closed/Sold
Valencia Park	Tenant in Common	2006	Closed/Sold
Fox Point	Tenant in Common	2006	Operating
Greenbrier	Tenant in Common	2006	Closed/Sold
Water Song	Tenant in Common	2007	Closed/Sold
Cottonwood Apartments	Tenant in Common	2007	Closed
West Town	Tenant in Common	2007	Closed/Sold
Gables Apartments	Tenant in Common	2007	Closed/Sold
Arbors at Windsor Lake	Tenant in Common	2008	Closed/Sold
Regatta	Tenant in Common	2008	Closed
Oak Ridge	Tenant in Common	2008	Closed/Sold
Copperfield	Tenant in Common	2008	Closed/Sold
Blue Swan	Tenant in Common	2008	Closed/Sold
Arbor Crossing	Tenant in Common	2009	Closed/Sold

See Appendix C, Table IV Operating Results of Prior Real Estate Programs Which Have Completed Operations, for information regarding the last five real estate programs that have been sold.

Prior Programs with Adverse Results

The following is a summary of the prior real estate programs of Cottonwood Capital, LLC and its affiliates as of December 31, 2018 that have experienced adverse results.

Copperfield, a multifamily apartment community located in San Antonio, Texas, was acquired in September, 2008 and sold by the tenant in common owners in September, 2015. When distributions are included, investors experienced an average annualized rate of return on the investor’s initial equity invest of -0.98%.

Tramore Village, a multifamily apartment community located in Austell, Georgia, was acquired in December, 2005 and sold by the tenant in common owners in June, 2015. When distributions are included, investors experienced an average annualized rate of return on the investor’s initial equity investment of -0.29%.

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Valencia Park, a multifamily apartment community located in Norcross, Georgia, was acquired in March, 2006 and sold by the tenant in common owners in March, 2015. When distributions are included, investors experienced an average annualized rate of return on the investor’s initial equity investment of -12.95%.

In addition, the prior real estate programs listed above were established from 2005 to 2009. In 2008, the United States economy experienced a significant recession. Real estate values in the United States were severely impacted. As a result of the recession, all of the prior real estate programs, at one or more times, failed to meet the projected distribution initially made by Cottonwood Capital, LLC and its affiliates with respect to such investment. See Appendix C, Table III Annual Operating Results of Prior Real Estate Programs and Table IV Operating Results of Prior Real Estate Programs Which Have Completed Operations for more detailed information regarding the performance of some of the prior real estate programs. All prior programs for which anticipated liquidation dates were set forth in the original offering document, and for which such dates have passed, were liquidated on or before the anticipated liquidation date.

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FEDERAL INCOME TAX CONSIDERATIONS

The following is a summary of the material United States federal income tax consequences of an investment in our common stock. The law firm of DLA Piper LLP (US) has acted as our tax counsel and reviewed this summary. For purposes of this section under the heading “Federal Income Tax Considerations,” references to “Cottonwood Communities,” “we,” “our,” and “us” mean only Cottonwood Communities, Inc. and not its subsidiaries or other lower-tier entities, except as otherwise indicated. This summary is based upon the Internal Revenue Code, the regulations promulgated by the United States Treasury Department, rulings and other administrative pronouncements issued by the Internal Revenue Service, and judicial decisions, all as currently in effect, and all of which are subject to differing interpretations or to change, possibly with retroactive effect. No assurance can be given that the Internal Revenue Service would not assert, or that a court would not sustain, a position contrary to any of the tax consequences described below. We have not sought and do not currently expect to seek an advance ruling from the Internal Revenue Service regarding any matter discussed in this prospectus. The summary is also based upon the assumption that we will operate Cottonwood Communities, Inc. and its subsidiaries and affiliated entities in accordance with their applicable organizational documents. This summary is for general information only and does not purport to discuss all aspects of United States federal income taxation that may be important to a particular investor in light of its investment or tax circumstances or to investors subject to special tax rules, such as:

• financial institutions;

• insurance companies;

• broker-dealers;

• regulated investment companies;

• partnerships and trusts;

• persons who hold our stock on behalf of other persons as nominees;

• persons who receive our stock through the exercise of employee stock options (if we ever have employees) or otherwise as compensation;

• persons holding our stock as part of a “straddle,” “hedge,” “conversion transaction,” “constructive ownership transaction,” “synthetic security,” or other integrated investment;

• “S” corporations;

and, except to the extent discussed below:

• tax-exempt organizations; and

• foreign investors.

This summary assumes that investors will hold their common stock as a capital asset, which generally means as property held for investment.

The federal income tax treatment of holders of our common stock depends in some instances on determinations of fact and interpretations of complex provisions of United States federal income tax law for which no clear precedent or authority may be available. In addition, the tax consequences to any particular shareholder of holding our common stock will depend on the shareholder’s particular tax circumstances. You are urged to consult your tax advisor regarding the federal, state, local, and foreign income and other tax consequences to you in light of your particular investment or tax circumstances of acquiring, holding, exchanging, or otherwise disposing of our common stock.

Taxation of Cottonwood Communities

We intend to elect to be taxed as a REIT beginning with the taxable year ending December 31, 2019. We believe that we have been organized and expect to operate in such a manner as to qualify for taxation as a REIT.

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The law firm of DLA Piper LLP (US), acting as our tax counsel in connection with this offering, has rendered an opinion that our organization and current and proposed method of operation will enable us to be taxed as a REIT pursuant to Sections 856 through 860 of the Internal Revenue Code, commencing with our taxable year ending December 31, 2019. It must be emphasized that the opinion of DLA Piper LLP (US) is based on various assumptions relating to our organization and operation and is conditioned upon fact-based representations and covenants made by our management regarding our organization, assets, and income, and the past, present, and future conduct of our business operations. While we intend to operate so that we will qualify as a REIT, given the highly complex nature of the rules governing REITs, the ongoing importance of factual determinations, and the possibility of future changes in our circumstances, no assurance can be given by DLA Piper LLP (US) or by us that we will qualify as a REIT for any particular year. The opinion is expressed as of the date issued and does not cover subsequent periods. Counsel has no obligation to advise us or our shareholders of any subsequent change in the matters stated, represented or assumed, or of any subsequent change in the applicable law. You should be aware that opinions of counsel are not binding on the Internal Revenue Service, and no assurance can be given that the Internal Revenue Service will not challenge the conclusions set forth in such opinions.

Qualification and taxation as a REIT depends on our ability to meet on a continuing basis, through actual operating results, distribution levels, and diversity of stock and asset ownership, various qualification requirements imposed upon REITs by the Internal Revenue Code, the compliance with which will not be reviewed by DLA Piper LLP (US). Our ability to qualify as a REIT also requires that we satisfy certain asset tests, some of which depend upon the fair market values of assets that we own directly or indirectly. Such values may not be susceptible to a precise determination. Accordingly, no assurance can be given that the actual results of our operations for any taxable year will satisfy such requirements for qualification and taxation as a REIT.

Taxation of REITs in General

As indicated above, our qualification and taxation as a REIT depends upon our ability to meet, on a continuing basis, various qualification requirements imposed upon REITs by the Internal Revenue Code. The material qualification requirements are summarized below under “Federal Income Tax Considerations—Taxation of Cottonwood Communities—Requirements for Qualification—General.” While we intend to operate so that we qualify as a REIT, no assurance can be given that the Internal Revenue Service will not challenge our qualification, or that we will be able to operate in accordance with the REIT requirements in the future. See “Federal Income Tax Considerations—Taxation of Cottonwood Communities —Failure to Qualify.”

Provided that we qualify as a REIT, we will generally be entitled to a deduction for dividends that we pay to our shareholders and therefore will not be subject to federal corporate income tax on our taxable income that is currently distributed to our shareholders. This treatment substantially eliminates the “double taxation” at the corporate and shareholder levels that generally results from an investment in a corporation. In general, the income that we generate is taxed only at the shareholder level upon distribution to our shareholders.

Certain domestic shareholders that are individuals, trusts or estates are taxed on corporate distributions at a maximum rate of 20% (the same as long-term capital gains). With limited exceptions, however, distributions from us or from other entities that are taxed as REITs are generally not eligible for this rate and will continue to be taxed at rates applicable to ordinary income, which will be as high as 37.0%. See “ —Taxation of Shareholders—Taxation of Taxable Domestic Shareholders—Distributions.” However, for taxable years prior to 2026, individual shareholders are generally allowed to deduct 20% of the aggregate amount of ordinary dividends distributed by us, subject to certain limitations, which would reduce the maximum marginal effective tax rate for individuals on the receipt of such ordinary dividends to 29.6%. The Internal Revenue Service has issued proposed regulations that would affect an individual shareholder’s ability to claim this deduction if our stock has not been held for at least 45 days prior to the payment of the dividend. Individual shareholders are urged to consult their tax advisors as to their ability to claim this deduction.

Any net operating losses and other tax attributes generally do not pass through to our shareholders, subject to special rules for certain items such as the capital gains that we recognize. See “—Taxation of Shareholders.”

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If we qualify as a REIT, we will nonetheless be subject to federal tax in the following circumstances:

• We will be taxed at regular corporate rates on any undistributed taxable income, including undistributed net capital gains.

• If we have net income from prohibited transactions, which are, in general, sales or other dispositions of inventory or property held primarily for sale to customers in the ordinary course of business, other than foreclosure property, such income will be subject to a 100% tax. See “—Prohibited Transactions” and “—Foreclosure Property” below.

• If we elect to treat property that we acquire with a foreclosure of a mortgage loan or certain leasehold terminations as “foreclosure property,” we may thereby avoid the 100% tax on gain from resale of that property (if the sale would otherwise constitute a prohibited transaction), but the income from the sale or operation of the property may be subject to corporate income tax at the highest applicable rate (currently 21%).

• If we should fail to satisfy the 75% gross income test or the 95% gross income test, as discussed below, but nonetheless maintain our qualification as a REIT because we satisfy other requirements, we will be subject to a 100% tax on an amount based on the magnitude of the failure, as adjusted to reflect the profit margin associated with our gross income.

• If we should violate the asset tests (other than certain de minimis violations) or other requirements applicable to REITs, as described below, and yet maintain our qualification as a REIT because there is reasonable cause for the failure and other applicable requirements are met, we may be subject to an excise tax. In that case, the amount of the excise tax will be at least $50,000 per failure, and, in the case of certain asset test failures, will be determined as the amount of net income generated by the assets in question multiplied by the highest corporate tax rate (currently 21%) if that amount exceeds $50,000 per failure.

• If we should fail to distribute during each calendar year at least the sum of (a) 85% of our REIT ordinary income for such year; (b) 95% of our REIT capital gain net income for such year; and (c) any undistributed taxable income from prior periods, we would be subject to a nondeductible 4% excise tax on the excess of the required distribution over the sum of (i) the amounts that we actually distributed and (ii) the amounts we retained and upon which we paid income tax at the corporate level.

• We may be required to pay monetary penalties to the Internal Revenue Service in certain circumstances, including if we fail to meet record keeping requirements intended to monitor our compliance with rules relating to the composition of a REIT’s shareholders, as described below in “—Requirements for Qualification—General.”

• If we acquire appreciated assets from a corporation that is not a REIT (i.e., a corporation taxable under subchapter C of the Internal Revenue Code) in a transaction in which the adjusted tax basis of the assets in our hands is determined by reference to the adjusted tax basis of the assets in the hands of the subchapter C corporation, we may be subject to tax on such appreciation at the highest corporate income tax rate then applicable if we subsequently recognize gain on a disposition of any such assets during the five-year period following their acquisition from the subchapter C corporation.

• The earnings of our subsidiaries are subject to federal corporate income tax to the extent that such subsidiaries are subchapter C corporations. We will also be subject to this rule with regard to assets acquired by us before the effective date of our REIT election that have appreciated.

In addition, we and our subsidiaries may be subject to a variety of taxes, including payroll taxes and state and local and foreign income, property and other taxes on our assets and operations. We could also be subject to tax in situations and on transactions not presently contemplated.

Requirements for Qualification—General

The Internal Revenue Code defines a REIT as a corporation, trust or association:

(1) that is managed by one or more trustees or directors;

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(2) the beneficial ownership of which is evidenced by transferable shares, or by transferable certificates of beneficial interest;

(3) that would be taxable as a domestic corporation but for its election to be subject to tax as a REIT;

(4) that is neither a financial institution nor an insurance company subject to specific provisions of the Internal Revenue Code;

(5) the beneficial ownership of which is held by 100 or more persons for at least 335 days of each taxable year of 12 months or during a proportionate part of a taxable year of less than 12 months;

(6) in which, during the last half of each taxable year, not more than 50% in value of the outstanding stock is owned, directly or indirectly, by five or fewer “individuals” (as defined in the Internal Revenue Code to include specified tax-exempt entities); and

(7) which meets other tests described below, including with respect to the nature of its income and assets.

The Internal Revenue Code provides that conditions (1) through (4) must be met during the entire taxable year, and that condition (5) must be met during at least 335 days of a taxable year of 12 months, or during a proportionate part of a shorter taxable year. Conditions (5) and (6) need not be met during a corporation’s initial tax year as a REIT. (In our case, we intend to elect to be taxed as a REIT for our taxable year ending December 31, 2019.) Our charter provides restrictions regarding the ownership and transfer of our shares, which are intended to assist us in satisfying the share ownership requirements described in conditions (5) and (6) above.

We believe that we will issue in this offering common stock with sufficient diversity of ownership to satisfy conditions (5) and (6). In addition, our charter restricts the ownership and transfer of our stock so that we should continue to satisfy these requirements. The provisions of our charter restricting the ownership and transfer of our common stock are described in “Description of Shares—Restriction on Ownership of Shares.”

To monitor compliance with the share ownership requirements, we generally are required to maintain records regarding the actual ownership of our shares. To do so, we must demand written statements each year from the record holders of significant percentages of our stock pursuant to which the record holders must disclose the actual owners of the shares (i.e., the persons required to include our distributions in their gross income). We must maintain a list of those persons failing or refusing to comply with this demand as part of our records. We could be subject to monetary penalties if we fail to comply with these record-keeping requirements. If you fail or refuse to comply with the demands, you will be required by Treasury Regulations to submit a statement with your tax return disclosing your actual ownership of our shares and other information.

In addition, a REIT may not have any undistributed C corporation earnings and profits at the end of any taxable year. Upon our election to be taxable as a REIT, any earnings and profits that we have accumulated while we were taxable as a C corporation would have to be distributed no later than the end of the first year for which we elect REIT status. If we fail to do so, we would not qualify to be taxed as a REIT for that year and a number of years thereafter, unless we are able to rely on certain relief provisions.

The Internal Revenue Code provides relief from violations of the REIT gross income requirements, as described below under “Income Tests,” in cases where a violation is due to reasonable cause and not to willful neglect, and other requirements are met, including the payment of a penalty tax that is based upon the magnitude of the violation. In addition, certain provisions of the Internal Revenue Code extend similar relief in the case of certain violations of the REIT asset requirements (see “Asset Tests” below) and other REIT requirements, again provided that the violation is due to reasonable cause and not willful neglect, and other conditions are met, including the payment of a penalty tax. If we fail to satisfy any of the various REIT requirements, there can be no assurance that these relief provisions would be available to enable us to maintain our qualification as a REIT, and, if such relief provisions are available, the amount of any resultant penalty tax could be substantial.

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Effect of Subsidiary Entities

Ownership of Partnership Interests. If we are a partner in an entity that is treated as a partnership for federal income tax purposes, Treasury Regulations provide that we are deemed to own our proportionate share of the partnership’s assets, and to earn our proportionate share of the partnership’s income, for purposes of the asset and gross income tests applicable to REITs. Our proportionate share of a partnership’s assets and income is based on our capital interest in the partnership (except that for purposes of the 10% value test, our proportionate share of the partnership’s assets is based on our proportionate interest in the equity and certain debt securities issued by the partnership). In addition, the assets and gross income of the partnership are deemed to retain the same character in our hands. Thus, our proportionate share of the assets and items of income of any of our subsidiary partnerships will be treated as our assets and items of income for purposes of applying the REIT requirements. For any period of time that we own 100% of our operating partnership, all of the operating partnership’s assets and income will be deemed to be ours for federal income tax purposes.

Under rules applicable to U.S. federal income tax audits of partnerships. Under new rules, among other changes and subject to certain exceptions, any audit adjustments to items of income, gain, loss, deduction or credit of a partnership (and any partner’s distributive share thereof) is determined, and taxes, interest or penalties attributable thereto are assessed and collected, at the partnership level. Such rules could result in a partnership in which we own an interest being required to pay additional taxes, interest and penalties as a result of an audit adjustment, and we could be required to bear the economic burden of those taxes, interest and penalties even though we, as a REIT, may not otherwise have been required to pay additional corporate-level taxes as a result of the related audit adjustment.

Disregarded Subsidiaries. If we own a corporate subsidiary that is a qualified REIT subsidiary, that subsidiary is generally disregarded for federal income tax purposes, and all of the subsidiary’s assets, liabilities and items of income, deduction and credit are treated as our assets, liabilities and items of income, deduction and credit, including for purposes of the gross income and asset tests applicable to REITs. A qualified REIT subsidiary is any corporation, other than a taxable REIT subsidiary, that is directly or indirectly wholly owned by a REIT. Other entities that are wholly owned by us, including single member limited liability companies that have not elected to be taxed as corporations for federal income tax purposes, are also generally disregarded as separate entities for federal income tax purposes, including for purposes of the REIT income and asset tests. Disregarded subsidiaries, along with any partnerships in which we hold an equity interest, are sometimes referred to herein as “pass-through subsidiaries.”

In the event that a disregarded subsidiary of ours ceases to be wholly owned—for example, if any equity interest in the subsidiary is acquired by a person other than us or another disregarded subsidiary of ours—the subsidiary’s separate existence would no longer be disregarded for federal income tax purposes. Instead, the subsidiary would have multiple owners and would be treated as either a partnership or a taxable corporation. Such an event could, depending on the circumstances, adversely affect our ability to satisfy the various asset and gross income requirements applicable to REITs, including the requirement that REITs generally may not own, directly or indirectly, more than 10% of the securities of another corporation. See “Asset Tests” and “Income Tests.”

Taxable REIT Subsidiaries. In the future we may jointly elect with any of our subsidiary corporations, whether or not wholly owned, to treat such subsidiary corporations as taxable REIT subsidiaries, or TRSs. A REIT is permitted to own up to 100% of the stock of one or more TRSs. A domestic TRS is a fully taxable corporation that may earn income that would not be qualifying income if earned directly by the parent REIT. The subsidiary and the REIT must jointly elect to treat the subsidiary as a TRS. A corporation with respect to which a TRS directly or indirectly owns more than 35% of the voting power or value of the stock will automatically be treated as a TRS. We generally may not own more than 10% of the securities of a taxable corporation, as measured by voting power or value, unless we and such corporation elect to treat such corporation as a TRS. Overall, no more than 20% of the value of a REIT’s assets may consist of stock or securities of one or more TRSs.

The separate existence of a TRS or other taxable corporation is not ignored for federal income tax purposes. Accordingly, a TRS or other taxable corporation generally would be subject to corporate income tax on its earnings, which may reduce the cash flow that we and our subsidiaries generate in the aggregate, and may reduce our ability to make distributions to our shareholders.

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We are not treated as holding the assets of a TRS or other taxable subsidiary corporation or as receiving any income that the subsidiary earns. Rather, the stock issued by a taxable subsidiary to us is an asset in our hands, and we treat the distributions paid to us from such taxable subsidiary, if any, as income. This treatment can affect our income and asset test calculations, as described below. Because we do not include the assets and income of TRSs or other taxable subsidiary corporations in determining our compliance with the REIT requirements, we may use such entities to undertake indirectly activities that the REIT rules might otherwise preclude us from doing directly or through pass-through subsidiaries. For example, we may use TRSs or other taxable subsidiary corporations to conduct activities that give rise to certain categories of income such as management fees or activities that would be treated in our hands as prohibited transactions.

Certain restrictions imposed on TRSs are intended to ensure that such entities will be subject to appropriate levels of United States federal income taxation. For example, if amounts are paid to a REIT or deducted by a TRS due to transactions between the REIT and a TRS that exceed the amount that would be paid to or deducted by a party in an arm’s-length transaction, the REIT generally will be subject to an excise tax equal to 100% of such excess. Note that the 100% tax will also apply to “redetermined services income,” i.e. non-arm’s-length income of a REIT’s TRS attributable to services provided to, or on behalf of, the REIT (other than services provided to REIT tenants, which are potentially taxed as redetermined rents). We intend to scrutinize all of our transactions with any of our subsidiaries that are treated as a TRS in an effort to ensure that we do not become subject to this excise tax; however, we cannot assure you that we will be successful in avoiding this excise tax.

Income Tests

In order to qualify as a REIT, we must satisfy two gross income requirements on an annual basis.

• First, at least 75% of our gross income for each taxable year, excluding gross income from sales of inventory or dealer property in “prohibited transactions,” generally must be derived from investments relating to real property or mortgages on real property or on interest in real property, including interest income derived from mortgage loans secured by real property, “rents from real property,” distributions received from other REITs and gains from the sale of real estate assets (other than a non-qualified publicly offered REIT debt instrument), as well as specified income from temporary investments.

• Second, at least 95% of our gross income in each taxable year, excluding gross income from prohibited transactions and certain hedging transactions, must be derived from some combination of such income from investments in real property (i.e., income that qualifies under the 75% income test described above), as well as other distributions, interest, and gain from the sale or disposition of stock or securities, which need not have any relation to real property.

Interest income constitutes qualifying mortgage interest for purposes of the 75% income test (as described above) to the extent that the obligation upon which such interest is paid is secured by a mortgage on real property. If we receive interest income with respect to a mortgage loan that is secured by both real property and personal property, and the highest principal amount of the loan outstanding during a taxable year exceeds the fair market value of the real property on the date that we acquired or originated the mortgage loan, the interest income will be apportioned between the real property and the personal property, and our income from the arrangement will qualify for purposes of the 75% income test only to the extent that the interest is allocable to the real property. However, for purposes of the 75% income test, if the fair market value of such personal property does not exceed 15% of the total fair market value of all such property, such personal property is treated as real property. Even if a loan is not secured by real property, or is undersecured, the income that it generates may nonetheless qualify for purposes of the 95% income test.

To the extent that we derive income from the rental of real property (discussed below) where all or a portion of the amount of rental income payable is contingent, such income generally will qualify for purposes of the gross income tests only if it is based upon the gross receipts or sales and not on the net income or profits of the lessee. This limitation does not apply, however, where the lessee leases substantially all of its interest in the property to tenants or subtenants to the extent that the rental income derived by the lessee would qualify as rents from real property had we earned the income directly.

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We and our subsidiaries may invest in mezzanine loans, which are loans secured by equity interests in an entity that directly or indirectly owns real property, rather than by a direct mortgage of the real property. The Internal Revenue Service has issued Revenue Procedure 2003-65, which provides a safe harbor applicable to mezzanine loans. Under the Revenue Procedure, if a mezzanine loan meets each of the requirements contained in the Revenue Procedure, (1) the mezzanine loan will be treated by the Internal Revenue Service as a real estate asset for purposes of the asset tests described below and (2) interest derived from the mezzanine loan will be treated as qualifying mortgage interest for purposes of the 75% income test. Although the Revenue Procedure provides a safe harbor on which taxpayers may rely, it does not prescribe rules of substantive tax law. We intend to structure any investments in mezzanine loans in a manner that generally complies with the various requirements applicable to our qualification as a REIT. However, the extent that any of our mezzanine loans do not meet all of the requirements for reliance on the safe harbor set forth in the Revenue Procedure, there can be no assurance that the Internal Revenue Service will not challenge the tax treatment of these loans.

Rents received by us will qualify as “rents from real property” in satisfying the gross income requirements described above only if several conditions are met.

• If rent is partly attributable to personal property leased in connection with a lease of real property, the portion of the rent that is attributable to the personal property will not qualify as “rents from real property” unless it constitutes 15% or less of the total rent received under the lease.

• The amount of rent must not be based in whole or in part on the income or profits of any person. Amounts received as rent, however, generally will not be excluded from rents from real property solely by reason of being based on fixed percentages of gross receipts or sales.

• We generally must not operate or manage the property or furnish or render services to the tenants of such property, other than through an “independent contractor” from which we derive no revenue. We are permitted, however, to perform services that are “usually or customarily rendered” in connection with the rental of space for occupancy only and which are not otherwise considered rendered to the occupant of the property. In addition, we may directly or indirectly provide non-customary services to tenants of our properties without disqualifying all of the rent from the property if the payments for such services do not exceed 1% of the total gross income from the properties. For purposes of this test, we are deemed to have received income from such non-customary services in an amount at least 150% of the direct cost of providing the services. Moreover, we are generally permitted to provide services to tenants or others through a TRS without disqualifying the rental income received from tenants for purposes of the income tests.

• We must not directly or constructively hold a 10% or greater interest, as measured by vote or value, in the lessee’s equity.

We may directly or indirectly receive distributions from TRSs or other corporations that are not REITs or qualified REIT subsidiaries. These distributions generally are treated as dividend income to the extent of the earnings and profits of the distributing corporation. Such distributions will generally constitute qualifying income for purposes of the 95% gross income test, but not for purposes of the 75% gross income test. Any distributions that we receive from a REIT, however, will be qualifying income for purposes of both the 95% and 75% income tests.

We may receive various fees in connection with our operations relating to the origination or purchase of whole loans secured by first mortgages and other loans secured by real property. The fees will generally be qualifying income for purposes of both the 75% and 95% gross income tests if they are received in consideration for entering into an agreement to make a loan secured by real property and the fees are not determined by income and profits. Other fees generally are not qualifying income for purposes of either gross income test and will not be favorably counted for purposes of either gross income test. Any fees earned by any TRS will not be included for purposes of the gross income tests. We and our subsidiaries may enter into hedging transactions with respect to one or more of our assets or liabilities. Hedging transactions could take a variety of forms, including interest rate swap agreements, interest rate cap agreements, options, futures contracts, forward rate agreements or similar financial instruments. Except to the extent provided by Treasury Regulations, any income from a hedging transaction we entered into (1) in the normal course of our business primarily to manage risk of interest rate, inflation and/or currency fluctuations with respect to borrowings made or to be made, or ordinary obligations incurred or to be

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incurred, to acquire or carry real estate assets, which is clearly identified as specified in Treasury Regulations before the closing of the day on which it was acquired, originated or entered into, including gain from the sale or disposition of such a transaction, (2) primarily to manage risk of currency fluctuations with respect to any item of income or gain that would be qualifying income under the 75% or 95% income tests, and (3) to manage risk with respect to the extinguishment of certain indebtedness or the disposition of certain property relating to prior hedging transactions described in (1) or (2) above, each of which is clearly identified as such before the closing of the day on which it was acquired, originated or entered to, will not constitute gross income for purposes of the 75% or 95% gross income tests.

If we fail to satisfy one or both of the 75% or 95% gross income tests for any taxable year, we may still qualify as a REIT for such year if we are entitled to relief under applicable provisions of the Internal Revenue Code. These relief provisions will be generally available if (1) our failure to meet these tests was due to reasonable cause and not due to willful neglect and (2) following our identification of the failure to meet the 75% or 95% gross income test for any taxable year, we file a schedule with the Internal Revenue Service setting forth each item of our gross income for purposes of the 75% or 95% gross income test for such taxable year in accordance with Treasury Regulations yet to be issued. It is not possible to state whether we would be entitled to the benefit of these relief provisions in all circumstances. If these relief provisions are inapplicable to a particular set of circumstances, we will not qualify as a REIT. As discussed above under “Taxation of REITs in General,” even where these relief provisions apply, the Internal Revenue Code imposes a tax based upon the amount by which we fail to satisfy the particular gross income test.

Asset Tests

At the close of each calendar quarter, we must also satisfy five tests relating to the nature of our assets.

• First, at least 75% of the value of our total assets must be represented by some combination of “real estate assets,” cash, cash items, United States government securities and, under some circumstances, stock or debt instruments purchased with new capital. For this purpose, real estate assets include interests in real property, such as land, buildings, leasehold interests in real property, stock of other corporations that qualify as REITs and some kinds of mortgage-backed securities and mortgage loans. To the extent that rent attributable to personal property is treated as rents from real property under the Internal Revenue Code, such personal property will be treated as a “real estate asset” for purposes of the 75% asset test. Further, a debt obligation secured by a mortgage on both real and personal property will be treated as a real estate asset for purposes of the 75% asset test, if the fair market value of the personal property does not exceed 15% of the fair market value of all property securing the debt. Assets that do not qualify for purposes of the 75% test are subject to the additional asset tests described below.

• Second, no more than 25% of our total assets may be represented by securities other than those in the 75% asset class; provided that not more than 25% of the value of our assets may consist of debt instruments issued by publicly offered REITs.

• Third, of the investments included in the 25% asset class, the value of any one issuer’s securities that we own may not exceed 5% of the value of our total assets. Additionally, we may not own more than 10% of any one issuer’s outstanding securities, as measured by either voting power or value. The 5% and 10% asset tests do not apply to securities of TRSs and qualified REIT subsidiaries and the 10% asset test does not apply to “straight debt” having specified characteristics and to certain other securities described below. Solely for purposes of the 10% asset test, the determination of our interest in the assets of a partnership or limited liability company in which we own an interest will be based on our proportionate interest in any securities issued by the partnership or limited liability company, excluding for this purpose certain securities described in the Internal Revenue Code.

• Fourth, the aggregate value of all securities of taxable REIT subsidiaries that we hold may not exceed 20% of the value of our total assets.

• Fifth, not more than 25% of the value of a REIT’s assets may consist of nonqualified publicly offered REIT debt instruments.

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Notwithstanding the general rule, as noted above, that for purposes of the REIT income and asset tests we are treated as owning our proportionate share of the underlying assets of a subsidiary partnership, if we hold indebtedness issued by a partnership, the indebtedness will be subject to, and may cause a violation of, the asset tests unless the indebtedness is a qualifying mortgage asset or other conditions are met. Similarly, although stock of another REIT is a qualifying asset for purposes of the REIT asset tests, any non-mortgage debt that is issued by another REIT may not so qualify (such debt, however, will not be treated as “securities” for purposes of the 10% asset test, as explained below).

Certain relief provisions are available to REITs to satisfy the asset requirements or to maintain REIT qualification notwithstanding certain violations of the asset and other requirements. One such provision allows a REIT which fails one or more of the asset requirements to nevertheless maintain its REIT qualification if (1) the REIT provides the Internal Revenue Service with a description of each asset causing the failure; (2) the failure is due to reasonable cause and not willful neglect; (3) the REIT pays a tax equal to the greater of (a) $50,000 per failure and (b) the product of the net income generated by the assets that caused the failure multiplied by the highest applicable corporate tax rate (currently 21%); and (4) the REIT either disposes of the assets causing the failure within six months after the last day of the quarter in which it identifies the failure, or otherwise satisfies the relevant asset tests within that time frame.

In the case of de minimis violations of the 10% and 5% asset tests, a REIT may maintain its qualification despite a violation of such requirements if (1) the value of the assets causing the violation does not exceed the lesser of 1% of the REIT’s total assets and $10,000,000, and (2) the REIT either disposes of the assets causing the failure within six months after the last day of the quarter in which it identifies the failure, or the relevant tests are otherwise satisfied within that time frame.

Certain securities will not cause a violation of the 10% asset test described above. Such securities include instruments that constitute “straight debt,” which includes, among other things, securities having certain contingency features. A security does not qualify as “straight debt” where a REIT (or a controlled TRS of the REIT) owns other securities of the same issuer which do not qualify as straight debt, unless the value of those other securities constitute, in the aggregate, 1% or less of the total value of that issuer’s outstanding securities. In addition to straight debt, the Internal Revenue Code provides that certain other securities will not violate the 10% asset test. Such securities include (1) any loan made to an individual or an estate; (2) certain rental agreements pursuant to which one or more payments are to be made in subsequent years (other than agreements between a REIT and certain persons related to the REIT under attribution rules); (3) any obligation to pay rents from real property; (4) securities issued by governmental entities that are not dependent in whole or in part on the profits of (or payments made by) a non-governmental entity; (5) any security (including debt securities) issued by another REIT; and (6) any debt instrument issued by a partnership if the partnership’s income is of a nature that it would satisfy the 75% gross income test described above under “Income Tests.” In applying the 10% asset test, a debt security issued by a partnership is not taken into account to the extent, if any, of the REIT’s proportionate interest in the equity and certain debt securities issued by that partnership.

Independent appraisals may not be obtained to support our conclusions as to the value of our total assets or the value of any particular security or securities. Moreover, values of some assets may not be susceptible to a precise determination, and values are subject to change in the future. Furthermore, the proper classification of an instrument as debt or equity for federal income tax purposes may be uncertain in some circumstances, which could affect the application of the REIT asset requirements. Accordingly, there can be no assurance that the Internal Revenue Service will not contend that our interests in our subsidiaries or in the securities of other issuers will not cause a violation of the REIT asset tests.

If we should fail to satisfy the asset tests at the end of a calendar quarter, such a failure would not cause us to lose our REIT qualification if we (1) satisfied the asset tests at the close of the preceding calendar quarter and (2) the discrepancy between the value of our assets and the asset requirements was not wholly or partly caused by an acquisition of non-qualifying assets, but instead arose from changes in the market value of our assets. If the condition described in (2) were not satisfied, we still could avoid disqualification by eliminating any discrepancy within 30 days after the close of the calendar quarter in which it arose or by making use of relief provisions described below.

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Annual Distribution Requirements

In order to qualify as a REIT, we are required to make distributions, other than capital gain distributions, to our shareholders in an amount at least equal to:

(a) the sum of

(1) 90% of our “REIT taxable income,” computed without regard to our net capital gains and the dividends-paid deduction, and

(2) 90% of our net income, if any, (after tax) from foreclosure property (as described below), minus

(b) the sum of certain specified items of non-cash income.

We generally must make these distributions in the taxable year to which they relate, or in the following taxable year if declared before we timely file our tax return for the year and if paid with or before the first regular distribution payment after such declaration. In order for dividends to be counted for this purpose for a REIT that is not “publicly offered”, and to provide a tax deduction for such REIT, the dividends must not be “preferential dividends.” A dividend is not a preferential dividend if the dividend is (1) pro rata among all outstanding shares of stock within a particular class and (2) in accordance with the preferences among different classes of stock as set forth in our organizational documents. These preferential dividend rules do not apply to a publicly offered REIT. We believe that we will be a publicly offered REIT.

To the extent that we distribute at least 90%, but less than 100%, of our “REIT taxable income,” as adjusted, we will be subject to tax at ordinary corporate tax rates on the retained portion. We may elect to retain, rather than distribute, our net long-term capital gains and pay tax on such gains. In this case, we could elect for our shareholders to include their proportionate shares of such undistributed long-term capital gains in income, and to receive a corresponding credit for their share of the tax that we paid. Our shareholders would then increase their adjusted basis of their stock by the difference between (a) the amounts of capital gain distributions that we designated and that they include in their taxable income minus (b) the tax that we paid on their behalf with respect to that income.

To the extent that we have available net operating losses carried forward from prior tax years, such losses may reduce the amount of distributions that we must make in order to comply with the REIT distribution requirements, noting that net operating loss carryovers can only offset at most 80% of taxable income (but such losses can be carried forward indefinitely). Such losses, however, will generally not affect the character, in the hands of our shareholders, of any distributions that are actually made as ordinary dividends or capital gains. See “Federal Income Tax Considerations—Taxation of Shareholders—Taxation of Taxable Domestic Shareholders—Distributions.”

If we should fail to distribute during each calendar year at least the sum of (a) 85% of our REIT ordinary income for such year; (b) 95% of our REIT capital gain net income for such year; and (c) any undistributed taxable income from prior periods, we would be subject to a non-deductible 4% excise tax on the excess of such required distribution over the sum of (x) the amounts actually distributed plus (y) the amounts of income we retained and on which we have paid corporate income tax.

We may be able to rectify a failure to meet the distribution requirements for a year by paying “deficiency dividends” to shareholders in a later year, which may be included in our deduction for distributions paid for the earlier year. In this case, we may be able to avoid losing REIT qualification or being taxed on amounts distributed as deficiency dividends. We will be required to pay interest and a penalty based on the amount of any deduction taken for deficiency dividends.

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Failure to Qualify

If we fail to satisfy one or more requirements for REIT qualification other than the gross income or asset tests, we could avoid disqualification if our failure is due to reasonable cause and not to willful neglect and we pay a penalty of $50,000 for each such failure. Relief provisions are available for failures of the gross income tests and asset tests, as described above in “Income Tests” and “Asset Tests.”

If we fail to qualify for taxation as a REIT in any taxable year, and the relief provisions described above do not apply, we would be subject to tax on our taxable income at regular corporate rates. We cannot deduct distributions to shareholders in any year in which we are not a REIT, nor would we be required to make distributions in such a year. In this situation, to the extent of current and accumulated earnings and profits, distributions to domestic shareholders that are individuals, trusts and estates will generally be taxable at capital gains rates. In addition, subject to the limitations of the Internal Revenue Code, corporate distributees may be eligible for the dividends received deduction. Unless we are entitled to relief under specific statutory provisions, we would also be disqualified from re-electing to be taxed as a REIT for the four taxable years following the year during which we lost qualification. It is not possible to state whether, in all circumstances, we would be entitled to this statutory relief.

Prohibited Transactions

Net income that we derive from a prohibited transaction is subject to a 100% tax. The term prohibited transaction generally includes a sale or other disposition of property (other than foreclosure property, as discussed below) that is held primarily for sale to customers in the ordinary course of a trade or business. We intend to conduct our operations so that no asset that we own (or are treated as owning) will be treated as, or as having been, held for sale to customers, and that a sale of any such asset will not be treated as having been in the ordinary course of our business. Whether property is held “primarily for sale to customers in the ordinary course of a trade or business” depends on the particular facts and circumstances. No assurance can be given that any property that we sell will not be treated as property held for sale to customers, or that we can comply with certain safe-harbor provisions of the Internal Revenue Code that would prevent such treatment. The 100% tax does not apply to gains from the sale of property that is held through a TRS or other taxable corporation, although such income will potentially be subject to tax in the hands of the corporation at regular corporate rates, nor does the 100% tax apply to sales that qualify for a safe harbor as described in Section 857(b)(6) of the Internal Revenue Code.

Foreclosure Property

Foreclosure property is real property and any personal property incident to such real property (1) that we acquire as the result of having bid on the property at foreclosure, or having otherwise reduced the property to ownership or possession by agreement or process of law, after a default (or upon imminent default) on a lease of the property or a mortgage loan held by us and secured by the property; (2) for which we acquired the related loan or lease at a time when default was not imminent or anticipated; and (3) with respect to which we made a proper election to treat the property as foreclosure property. We generally will be subject to tax at the maximum corporate rate (currently 21%) on any net income from foreclosure property, including any gain from the disposition of the foreclosure property, other than income that would otherwise be qualifying income for purposes of the 75% gross income test. Any gain from the sale of property for which a foreclosure property election has been made will not be subject to the 100% tax on gains from prohibited transactions described above, even if the property would otherwise constitute inventory or dealer property. To the extent that we receive any income from foreclosure property that does not qualify for purposes of the 75% gross income test, we intend to make an election to treat the related property as foreclosure property.

Taxation of Shareholders

Taxation of Taxable Domestic Shareholders

Distributions. So long as we qualify as a REIT, the distributions that we make to our taxable domestic shareholders out of current or accumulated earnings and profits that we do not designate as capital gain distributions will generally be taken into account by shareholders as ordinary income and will not be eligible for the dividends received deduction for corporations. With limited exceptions, our distributions are not eligible for taxation at the

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preferential income tax rates (i.e., the 20% maximum federal rate) for qualified distributions received by domestic shareholders that are individuals, trusts and estates from taxable C corporations, provided individuals may be able to deduct 20% of income received as ordinary REIT dividends, thus reducing the maximum effective federal income tax rate on such dividend. Such shareholders, however, are taxed at the preferential rates on distributions designated by and received from REITs to the extent that the distributions are attributable to:

• income retained by the REIT in the prior taxable year on which the REIT was subject to corporate level income tax (less the amount of tax);

• distributions received by the REIT from TRSs or other taxable C corporations; or

• income in the prior taxable year from the sales of “built-in gain” property acquired by the REIT from C corporations in carryover basis transactions (less the amount of corporate tax on such income).

Distributions that we designate as capital gain dividends will generally be taxed to our shareholders as long-term capital gains, to the extent that such distributions do not exceed our actual net capital gain for the taxable year, without regard to the period for which the shareholder that receives such distribution has held its stock. We may elect to retain and pay taxes on some or all of our net long-term capital gains, in which case provisions of the Internal Revenue Code will treat our shareholders as having received, solely for tax purposes, our undistributed capital gains, and the shareholders will receive a corresponding credit for taxes that we paid on such undistributed capital gains. See “Federal Income Tax Considerations – Annual Distribution Requirements.” Corporate shareholders may be required to treat up to 20% of some capital gain distributions as ordinary income. Long-term capital gains are generally taxable at maximum federal rates of 20% in the case of shareholders that are individuals, trusts and estates, and 21% in the case of shareholders that are corporations. Capital gains dividends attributable to the sale of depreciable real property held for more than 12 months are subject to a 25% U.S. federal income tax rate for taxable domestic shareholders who are individuals, trusts or estates, to the extent of certain previously claimed depreciation deductions.

For purposes of determining the portion of distributions on separate classes of securities that will be treated as dividends for United States federal income tax purposes, current and accumulated earnings and profits will be allocated to distributions resulting from priority rights of preferred stock before being allocated to other distributions.

Distributions in excess of our current and accumulated earnings and profits will generally represent a return of capital and will not be taxable to a shareholder to the extent that the amount of such distributions do not exceed the adjusted basis of the shareholder’s shares in respect of which the distributions were made. Rather, the distribution will reduce the adjusted basis of the shareholder’s shares. To the extent that such distributions exceed the adjusted basis of a shareholder’s shares, the shareholder generally must include such distributions in income as long-term capital gain, or short-term capital gain if the shares have been held for one year or less. In addition, any distributions that we declare in October, November or December of any year and that is payable to a shareholder of record on a specified date in any such month will be treated as both paid by us and received by the shareholder on December 31 of such year, provided that we actually pay the distribution before the end of January of the following calendar year.

To the extent that we have available net operating losses and capital losses carried forward from prior tax years, such losses may reduce the amount of distributions that we must make in order to comply with the REIT distribution requirements. See “Federal Income Tax Considerations – Annual Distribution Requirements.” Such losses, however, are not passed through to shareholders and do not offset income of shareholders from other sources, nor would such losses affect the character of any distributions that we make, which are generally subject to tax in the hands of shareholders to the extent that we have current or accumulated earnings and profits.

Dispositions of Our Stock. In general, a taxable domestic shareholder who is not a dealer in securities must treat any gain or loss realized upon a taxable disposition of our stock as long-term capital gain or loss if the taxable domestic shareholder has held our stock for more than one year. Otherwise, the taxable domestic shareholder must treat any such gain or loss as short-term capital gain or loss. However, a taxable domestic shareholder must treat any loss upon a sale or exchange of our stock held by such shareholder for six months or less as a long-term capital loss to the extent of capital gain dividends and any other actual or deemed distributions from us that such shareholder treats as long-term capital gain. All or a portion of any loss that a taxable domestic shareholder realizes upon a taxable disposition of our stock may be disallowed if the United States shareholder repurchases our stock within 30 days before or after the disposition.

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Capital Gains and Losses. The tax rate differential between capital gain and ordinary income for non-corporate taxpayers may be significant. A taxpayer generally must hold a capital asset for more than one year for gain or loss derived from its sale or exchange to be treated as long-term capital gain or loss. The highest marginal individual income tax rate is currently 37%. The maximum tax rate on long-term capital gains applicable to non-corporate taxpayers is 20% for sales and exchanges of capital assets held for more than one year. The maximum tax rate on long-term capital gain from the sale or exchange of “section 1250 property,” or depreciable real property, is 25% to the extent that such gain, known as “unrecaptured section 1250 gains,” would have been treated as ordinary income on depreciation recapture if the property were “section 1245 property.” With respect to the distributions that we designate as capital gain dividends and any retained capital gain that we are deemed to distribute, we generally may designate whether such a distribution is taxable to our non-corporate shareholders as long term capital gains or unrecaptured section 1250 gains. The Internal Revenue Service has the authority to prescribe, but has not yet prescribed, regulations that would apply a capital gain tax rate of 25% (which is generally higher than the long-term capital gain tax rates for non-corporate taxpayers) to a portion of capital gain realized by a non-corporate shareholder on the sale of REIT stock that would correspond to the REIT’s “unrecaptured Section 1250 gain.” In addition, the characterization of income as capital gain or ordinary income may affect the deductibility of capital losses. A non-corporate taxpayer may deduct capital losses not offset by capital gains against its ordinary income only up to a maximum annual amount of $3,000. A non-corporate taxpayer may carry forward unused capital losses indefinitely. A corporate taxpayer must pay tax on its net capital gain at ordinary corporate rates (currently up to 21%). A corporate taxpayer may deduct capital losses only to the extent of capital gains, with unused losses being carried back three years and forward five years.

If a taxable domestic shareholder recognizes a loss upon a subsequent disposition of our stock in an amount that exceeds a prescribed threshold, it is possible that the provisions of certain Treasury Regulations involving “reportable transactions” could apply, with a resulting requirement to separately disclose the loss generating transactions to the Internal Revenue Service. While these regulations are directed towards “tax shelters,” they were written quite broadly, and apply to transactions that would not typically be considered tax shelters. Significant penalties apply for failure to comply with these requirements. You should consult your tax advisors concerning any possible disclosure obligation with respect to the receipt or disposition of our stock, or transactions that might be undertaken directly or indirectly by us. Moreover, you should be aware that we and other participants in transactions involving us might be subject to disclosure or other requirements pursuant to these regulations.

Passive Activity Losses and Investment Interest Limitations. Distributions that we make and gain arising from the sale or exchange by a domestic shareholder of our stock will not be treated as passive activity income. As a result, shareholders will not be able to apply any “passive losses” against income or gain relating to our stock. To the extent that distributions we make do not constitute a return of capital, they will be treated as investment income for purposes of computing the investment interest limitation.

Medicare Tax. A United States person that is an individual is subject to a 3.8% tax on the lesser of (i) the United States person’s “net investment income” for the relevant taxable year and (ii) the excess of the United States person’s modified gross income for the taxable year over a certain threshold (which currently is between $125,000 and $250,000, depending on the individual’s circumstances). Estates and trusts that do not fall into a special class of trusts that is exempt from such tax are subject to the same 3.8% tax on the lesser of their undistributed net investment income and the excess of their adjusted gross income over a certain threshold. Net investment income generally includes dividends on our stock and gain from the sale of our stock. The temporary 20% deduction with respect to ordinary REIT dividends received by non-corporate taxpayers is likely not allowed as a deduction allocable to such dividends for purposes of determining the amount of net investment income subject to 3.8% Medicare tax, which is imposed under Chapter 2A of the Internal Revenue Code. If you are a U.S. person that is an individual, estate or trust, you are urged to consult your tax advisors regarding the applicability of this tax to your income and gains in respect of your investment in our stock.

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Taxation of Foreign Shareholders

The following is a summary of certain United States federal income and estate tax consequences of the ownership and disposition of our stock applicable to non-United States holders. A non-United States holder is any person other than:

• a citizen or resident of the United States;

• a corporation (or entity treated as a corporation for United States federal income tax purposes) created or organized in the United States or under the laws of the United States, or of any state thereof, or the District of Columbia;

• an estate, the income of which is includable in gross income for United States federal income tax purposes regardless of its source; or

• a trust if a United States court is able to exercise primary supervision over the administration of such trust and one or more United States fiduciaries have the authority to control all substantial decisions of the trust.

If a partnership, including for this purpose any entity that is treated as a partnership for United States federal income tax purposes, holds our common stock, the tax treatment of a partner in the partnership will generally depend upon the status of the partner and the activities of the partnership. An investor that is a partnership and the partners in such partnership should consult their tax advisors about the United States federal income tax consequences of the acquisition, ownership and disposition of our common stock.

The following discussion is based on current law, and is for general information only. It addresses only selected, and not all, aspects of United States federal income and estate taxation. In addition, certain “qualified shareholders” and “qualified foreign pension plans” may be subject to certain statutory exemptions as discussed herein. Such shareholders are urged to consult their own tax advisors concerning the availability of such exemptions.

Ordinary Dividends. The portion of distributions received by non-United States holders (1) that is payable out of our earnings and profits; (2) which is not attributable to our capital gains; and (3) which is not effectively connected with a United States trade or business of the non-United States holder, will be subject to United States withholding tax at the rate of 30%, unless reduced or eliminated by treaty. As required by Internal Revenue Service guidance, we intend to notify our shareholders if a portion of a distribution paid by us is attributable to excess inclusion income.

In general, non-United States holders will not be considered to be engaged in a United States trade or business solely as a result of their ownership of our stock. In cases where the dividend income from a non-United States holder’s investment in our stock is, or is treated as, effectively connected with the non-United States holder’s conduct of a United States trade or business, the non-United States holder generally will be subject to United States federal income tax at graduated rates, in the same manner as domestic shareholders are taxed with respect to such distributions. Such income must generally be reported on a United States income tax return filed by or on behalf of the non-United States holder. The income may also be subject to the 30% branch profits tax in the case of a non-United States holder that is a corporation.

Non-Dividend Distributions. Unless our stock constitutes a USRPI, distributions that we make that are not out of our earnings and profits will generally not be subject to United States income tax. If we cannot determine at the time a distribution is made whether or not the distribution will exceed current and accumulated earnings and profits, the distribution will be subject to withholding at the rate applicable to ordinary dividends. The non-United States holder may seek a refund from the Internal Revenue Service of any amounts withheld if it is subsequently determined that the distribution was, in fact, in excess of our current and accumulated earnings and profits. If our stock constitutes a USRPI, as described below, distributions that we make in excess of the sum of (a) the shareholder’s proportionate share of our earnings and profits, plus (b) the shareholder’s basis in its stock, will be taxed under FIRPTA at the rate of tax, including any applicable capital gains rates, that would apply to a domestic shareholder of the same type (e.g., an individual or a corporation, as the case may be), and the collection of the tax will be enforced by a refundable withholding at a rate of 15% of the amount by which the distribution exceeds the shareholder’s share of our earnings and profits.

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Capital Gain Distributions. Under the Foreign Investment in Real Property Tax Act of 1980, or FIRPTA (unless an exemption applies), a distribution that we make to a non-United States holder, to the extent attributable to gains from dispositions of United States Real Property Interests, or USRPIs, that we held directly or through pass-through subsidiaries, or USRPI capital gains, will, except as described below, be considered effectively connected with a United States trade or business of the non-United States holder and will be subject to United States income tax at the rates applicable to United States individuals or corporations, without regard to whether we designate the distribution as a capital gain distribution. See above under “—Taxation of Foreign Shareholders—Ordinary Dividends,” for a discussion of the consequences of income that is effectively connected with a United States trade or business. In addition, we will be required to withhold tax equal to 21% of the amount of distributions to the extent the distributions constitute USRPI capital gains. Distributions subject to FIRPTA may also be subject to a 30% branch profits tax in the hands of a non-United States holder that is a corporation. A distribution is not a USRPI capital gain if we held an interest in the underlying asset solely as a creditor. Capital gain distributions received by a non-United States holder that are attributable to dispositions of our assets other than USRPIs are not subject to United States federal income or withholding tax, unless (1) the gain is effectively connected with the non-United States holder’s United States trade or business, in which case the non-United States holder would be subject to the same treatment as United States holders with respect to such gain or (2) the non- United States holder is a nonresident alien individual who was present in the United States for 183 days or more during the taxable year and has a “tax home” in the United States, in which case the non-United States holder will incur a 30% tax on his or her capital gains.

A capital gain distribution that would otherwise have been treated as a USRPI capital gain will not be so treated or be subject to FIRPTA, and generally will not be treated as income that is effectively connected with a United States trade or business, and instead will be treated in the same manner as an ordinary dividend (see “—Taxation of Foreign Shareholders—Ordinary Dividends”), if (1) the capital gain distribution is received with respect to a class of stock that is regularly traded on an established securities market located in the United States and (2) the recipient non-United States holder does not own more than 10% of that class of stock at any time during the year ending on the date on which the capital gain distribution is received. At the time you purchase shares in this offering, our shares will not be publicly traded and we can give you no assurance that our shares will ever be publicly traded on an established securities market. Therefore, these rules will not apply to our capital gain distributions.

Qualified Shareholders. Subject to the exception discussed below, any distribution to a “qualified shareholder” who holds stock of a REIT directly or indirectly (through one or more partnerships) will not be subject to United States tax as income effectively connected with a United States trade or business and thus will not be subject to special withholding rules under FIRPTA. While a “qualified shareholder” will not be subject to FIRPTA withholding on REIT distributions, certain investors of a “qualified shareholder” (i.e., non- United States persons who hold interests in the “qualified shareholder” (other than interests solely as a creditor), and hold more than 10% of the stock of the REIT in which the “qualified shareholder” holds stock (whether or not by reason of the investor’s ownership in the “qualified shareholder”) may be subject to FIRPTA withholding.

A “qualified shareholder” is a foreign person that (i) either is eligible for the benefits of a comprehensive income tax treaty which includes an exchange of information program and whose principal class of interests is listed and regularly traded on one or more recognized stock exchanges (as defined in such comprehensive income tax treaty), or is a foreign partnership that is created or organized under foreign law as a limited partnership in a jurisdiction that has an agreement for the exchange of information with respect to taxes with the United States and has a class of limited partnership units representing greater than 50% of the value of all the partnership units that is regularly traded on the NYSE or NASDAQ markets, (ii) is a qualified collective investment vehicle (defined below), and (iii) maintains records on the identity of each person who, at any time during the foreign person’s taxable year, is the direct owner of 5% or more of the class of interests or units (as applicable) described in (i), above.

A qualified collective investment vehicle is a foreign person that (i) would be eligible for a reduced rate of withholding with respect to ordinary dividends under the comprehensive income tax treaty described above, even if such entity holds more than 10% of the stock of such REIT, (ii) is publicly traded (as defined in Section 7704(b) of

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the Internal Revenue Code, is treated as a partnership under the Internal Revenue Code, is a withholding foreign partnership for purposes of United States withholding taxes, and would be treated as a United States real property holding company if it were a domestic corporation, or (iii) is designated as such by the Secretary of the Treasury and is either (a) fiscally transparent within the meaning of Section 894 of the Internal Revenue Code, or (b) required to include dividends in its gross income, but is entitled to a deduction for distributions to its investors.

Qualified Foreign Pension Funds. Any distribution to a “qualified foreign pension fund” or an entity all of the interests of which are held by a “qualified foreign pension fund” who holds REIT stock directly or indirectly (through one or more partnerships) will generally not be subject to United States tax as income effectively connected with a United States trade or business and thus will not be subject to the withholding rules under FIRPTA.

A qualified foreign pension fund is any trust, corporation, or other organization or arrangement (i) which is created or organized under the law of a country other than the United States, (ii) which is established to provide retirement or pension benefits to participants or beneficiaries that are current or former employees (or persons designated by such employees) of one or more employers in consideration for services rendered, (iii) which does not have a single participant or beneficiary with a right to more than 5% of its assets or income, (iv) which is subject to government regulation and provides annual information reporting about its beneficiaries to the relevant tax authorities in the country in which it is established or operates and (v) with respect to which, under the laws of the country in which it is established or operates, (A) contributions to such organization or arrangement that would otherwise be subject to tax under such laws are deductible or excluded from the gross income of such entity or taxed at a reduced rate, or (B) taxation of any investment income of such organization or arrangement is deferred or such income is taxed at a reduced rate.

Dispositions of Our Stock. Unless our stock constitutes a USRPI, our distributions that are not distributions out of our earnings and profits will generally not be subject to United States income tax. If it cannot be determined at the time at which a distribution is made whether the distribution will exceed current and accumulated earnings and profits, the distribution will be subject to withholding at the rate applicable to distributions. However, the non-United States holder may seek a refund from the Internal Revenue Service of any amounts withheld if it is subsequently determined that the distribution was, in fact, in excess of our current and accumulated earnings and profits. If our stock constitutes a USRPI, as described above, our dividends in excess of the sum of our earnings and profits plus the shareholder’s basis in shares of our common stock will be taxed FIRPTA at the rate of tax, including any applicable capital gains rates, that would apply to a domestic shareholder of the same type (e.g., an individual or a corporation, as the case may be), and the collection of the tax will be enforced by a refundable withholding at a rate of 15% of the amount by which the distribution exceeds the shareholder’s share of our earnings and profits.

Non-United States holders could incur tax under FIRPTA with respect to gain realized upon a disposition of our shares if we are a United States real property holding corporation during a specified testing period. If at least 50% of a REIT’s assets are USRPIs during the testing period, then the REIT will be a United States real property holding corporation (and our stock will constitute a USRPI absent an exemption). We believe that we are, and will continue to be, a United States real property holding corporation based on our investment strategy. However, even if we are a United States real property holding corporation, a non-United States shareholder generally would not incur tax under FIRPTA on gain from the sale of our common stock if we are a “domestically controlled qualified investment entity.” However, even if we are a domestically controlled qualified investment entity, upon disposition of our stock, a non-United States shareholder may be treated as having gain from the sale or exchange of a USRPI if the non-United States holder (i) disposes of our common stock within a 30-day period preceding the ex-dividend date of a distribution, any portion of which distribution would, but for the disposition, have been treated as gain from the sale or exchange of a USRPI and (ii) acquires, or enters into a contract or option to acquire, other shares of our common stock within 30 days after such ex-dividend date.

A “domestically controlled qualified investment entity” includes a REIT in which, at all times during a specified testing period, less than 50% in value of its shares are held directly or indirectly by non-United States shareholders. We cannot assure you that this test will be met.

If the applicable class of our stock is regularly traded on an established securities market, an additional exception to the tax under FIRPTA will be available with respect to such stock, even if we do not qualify as a domestically controlled qualified investment entity at the time the non-United States shareholder sells such stock.

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Under that exception, the gain from such a sale by such a non-United States shareholder will not be subject to tax under FIRPTA if (1) the applicable class of our stock is treated as being regularly traded under applicable Treasury Regulations on an established securities market and (2) the non-United States shareholder owned, actually or constructively, 10% or less of that class of stock at all times during a specified testing period. We believe that our common stock to be issued in this offering will not be regularly traded on an established securities market.

A sale of our common stock by a “qualified shareholder” or a “qualified foreign pension fund” that holds such stock directly or indirectly (through one or more partnerships) will not be subject to U.S. federal income taxation under FIRPTA. While a “qualified shareholder” will not be subject to FIRPTA withholding upon sale of our shares, certain investors of a “qualified shareholder” (i.e., non-United States persons who hold interests in the “qualified shareholder” (other than interests solely as a creditor), and hold, directly or indirectly, more than 10% of our stock (whether or not by reason of the investor’s ownership in the “qualified shareholder”)) may be subject to FIRPTA withholding.

If the gain on the sale of shares of our common stock were taxed under FIRPTA, a non-United States shareholder would be taxed on that gain in the same manner as United States shareholders, subject to applicable alternative minimum tax in the case of nonresident alien individuals. If we are not a domestically controlled qualified investment entity at the time our common stock is sold and the non-United States shareholder does not qualify for the exemptions described in the preceding paragraph, under FIRPTA the purchaser of shares of common stock also may be required to withhold 15% of the purchase price and remit this amount to the Internal Revenue Service on behalf of the selling non-United States shareholder.

Gain from the sale of our stock that would not otherwise be subject to FIRPTA will nonetheless be taxable in the United States to a non-United States holder in two cases: (i) if the non-United States holder’s investment in our stock is effectively connected with a United States trade or business conducted by such non-United States holder, the non-United States holder will be subject to the same treatment as a United States shareholder with respect to such gain, or (ii) if the non-United States holder is a nonresident alien individual who was present in the United States for 183 days or more during the taxable year and certain other conditions are satisfied, the nonresident alien individual will be subject to a 30% tax on the individual’s capital gain.

Estate Tax. If our stock is owned or treated as owned by an individual who is not a citizen or resident (as specially defined for United States federal estate tax purposes) of the United States at the time of such individual’s death, the stock will be includable in the individual’s gross estate for United States federal estate tax purposes, unless an applicable estate tax treaty provides otherwise, and may therefore be subject to United States federal estate tax.

FATCA Withholding on Certain Foreign Accounts and Entities. The Foreign Account Tax Compliance Act, or FATCA, generally imposes a 30% withholding tax on certain types of payments (including dividends on our stock) made to “foreign financial institutions” and certain other non-United States entities unless (i) the foreign financial institution undertakes certain diligence and reporting obligations or (ii) the foreign non-financial entity either certifies it does not have any substantial United States owners or furnishes identifying information regarding each substantial United States owner. If the payee is a foreign financial institution that is not subject to special treatment under certain intergovernmental agreements, it must enter into an agreement with the United States Treasury requiring, among other things, that it undertakes to identify accounts held by certain United States persons or United States-owned foreign entities, annually report certain information about such accounts and withhold 30% on payments to account holders whose actions prevent them from complying with these reporting and other requirements. Investors in jurisdictions that have entered into intergovernmental agreements may, in lieu of the foregoing requirements, be required to report such information to their home jurisdictions. While FATCA also technically imposes a 30% withholding tax on gross proceeds from the sale of our stock commencing on January 1, 2019, the Treasury Department released proposed Treasury Regulations which, if finalized in their present form, would eliminate the FATCA withholding on payments of such gross proceeds. Taxpayers generally may rely on these proposed Treasury Regulations until final Treasury Regulations are issued. Prospective investors should consult their tax advisors regarding this legislation.

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Taxation of Tax-Exempt Shareholders

Tax-exempt entities, including qualified employee pension and profit sharing trusts and individual retirement accounts, generally are exempt from federal income taxation. However, they may be subject to taxation on their unrelated business taxable income, or UBTI. While some investments in real estate may generate UBTI, the Internal Revenue Service has ruled that dividend distributions from a REIT to a tax-exempt entity do not constitute UBTI. Based on that ruling, and provided that (1) a tax-exempt shareholder has not held our stock as “debt financed property” within the meaning of the Internal Revenue Code (i.e., where the acquisition or holding of the property is financed through a borrowing by the tax-exempt shareholder) and (2) our stock is not otherwise used in an unrelated trade or business, distributions that we make and income from the sale of our stock generally should not give rise to UBTI to a tax-exempt shareholder.

To the extent, however, that we are (or a part of us, or a disregarded subsidiary of ours is) deemed to be a TMP, or if we hold residual interests in a REMIC, a portion of the distributions paid to a tax-exempt shareholder that is allocable to excess inclusion income may be treated as UBTI. We anticipate that our investments may generate excess inclusion income. As required by Internal Revenue Service guidance, we intend to notify our shareholders if a portion of a distribution paid by us is attributable to excess inclusion income.

Tax-exempt shareholders that are social clubs, voluntary employee benefit associations, supplemental unemployment benefit trusts and qualified group legal services plans exempt from federal income taxation under Sections 501(c)(7), (c)(9), (c)(17), and (c)(20) of the Internal Revenue Code are subject to different UBTI rules, which generally require such shareholders to characterize distributions that we make as UBTI.

In certain circumstances, a pension trust that owns more than 10% of our stock could be required to treat a percentage of its distributions as UBTI, if we are a “pension-held REIT.” We will not be a pension-held REIT unless either (1) one pension trust owns more than 25% of the value of our stock or (2) a group of pension trusts, each individually holding more than 10% of the value of our stock, collectively owns more than 50% of our stock. Certain restrictions on ownership and transfer of our stock should generally prevent a tax-exempt entity from owning more than 10% of the value of our stock and should generally prevent us from becoming a pension-held REIT.

Tax-exempt shareholders are urged to consult their tax advisors regarding the federal, state, local and foreign income and other tax consequences of owning our stock.

Backup Withholding and Information Reporting

We will report to our domestic shareholders and the Internal Revenue Service the amount of dividends paid during each calendar year and the amount of any tax withheld. Under the backup withholding rules, a domestic shareholder may be subject to backup withholding with respect to dividends paid unless the holder is a corporation or comes within other exempt categories and, when required, demonstrates this fact or provides a taxpayer identification number or social security number, certifies as to no loss of exemption from backup withholding and otherwise complies with applicable requirements of the backup withholding rules. A domestic shareholder that does not provide his or her correct taxpayer identification number or social security number may also be subject to penalties imposed by the Internal Revenue Service. Backup withholding is not an additional tax. In addition, we may be required to withhold a portion of a capital gain distribution to any domestic shareholder who fails to certify its non-foreign status.

We must report annually to the Internal Revenue Service and to each non-United States shareholder the amount of dividends paid to such holder and the tax withheld with respect to such dividends, regardless of whether withholding was required. Copies of the information returns reporting such dividends and withholding may also be made available to the tax authorities in the country in which the non-United States shareholder resides under the provisions of an applicable income tax treaty. A non-United States shareholder may be subject to backup withholding unless applicable certification requirements are met.

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Payment of the proceeds of a sale of our common stock within the United States is subject to both backup withholding and information reporting unless the beneficial owner certifies under penalties of perjury that it is a non-United States shareholder (and the payor does not have actual knowledge or reason to know that the beneficial owner is a United States person) or the holder otherwise establishes an exemption. Payment of the proceeds of a sale of our common stock conducted through certain United States related financial intermediaries is subject to information reporting (but not backup withholding) unless the financial intermediary has documentary evidence in its records that the beneficial owner is a non-United States shareholder and specified conditions are met or an exemption is otherwise established. Any amounts withheld under the backup withholding rules may be allowed as a refund or a credit against such holder’s United States federal income tax liability provided the required information is furnished to the Internal Revenue Service.

Other Tax Considerations

Legislative or Other Actions Affecting REITs

The rules dealing with federal income taxation are constantly under review by persons involved in the legislative process and by the Internal Revenue Service and the United States Treasury Department. Changes to the federal tax laws and interpretations thereof could adversely affect an investment in our stock.

State, Local and Foreign Taxes

We and our subsidiaries and shareholders may be subject to state, local, or foreign taxation in various jurisdictions including those in which we or they transact business, own property or reside. We may own real property assets located in numerous jurisdictions, and may be required to file tax returns in some or all of those jurisdictions. Our state, local, or foreign tax treatment and that of our shareholders may not conform to the federal income tax treatment discussed above. We may own foreign real estate assets and pay foreign property taxes, and dispositions of foreign property or operations involving, or investments in, foreign real estate assets may give rise to foreign income or other tax liability in amounts that could be substantial. Any foreign taxes that we incur do not pass through to shareholders as a credit against their United States federal income tax liability. Prospective investors should consult their tax advisors regarding the application and effect of state, local, and foreign income and other tax laws on an investment in our stock.

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ERISA CONSIDERATIONS

The following is a summary of some considerations associated with an investment in our shares by a qualified employee pension benefit plan or an individual retirement account (IRA). This summary is based on provisions of the Employee Retirement Income Security Act of 1974 (ERISA) and the Internal Revenue Code, each as amended through the date of this prospectus, and the relevant regulations, opinions and other authority issued by the Department of Labor and the Internal Revenue Service. We cannot assure you that there will not be adverse tax or labor decisions or legislative, regulatory or administrative changes that would significantly modify the statements expressed herein. Any such changes may apply to transactions entered into prior to the date of their enactment.

Each fiduciary of an employee pension benefit plan subject to ERISA (such as a profit sharing, Section 401(k) or pension plan) or any other retirement plan or account subject to Section 4975 of the Internal Revenue Code, such as an IRA, seeking to invest plan assets in our shares must, taking into account the facts and circumstances of each such plan or IRA (Benefit Plan), consider, among other matters:

• whether the investment is consistent with the applicable provisions of ERISA and the Internal Revenue Code;

• whether, under the facts and circumstances pertaining to the Benefit Plan in question, the fiduciary’s responsibility to the plan has been satisfied;

• whether the investment will produce an unacceptable amount of UBTI to the Benefit Plan (see “Federal Income Tax Considerations – Taxation of Shareholders – Taxation of Tax-Exempt Shareholders”); and

• the need to value the assets of the Benefit Plan annually.

Under ERISA, a plan fiduciary’s responsibilities include the following duties:

• to act solely in the interest of plan participants and beneficiaries and for the exclusive purpose of providing benefits to them, as well as defraying reasonable expenses of plan administration;

• to invest plan assets prudently;

• to diversify the investments of the plan, unless it is clearly prudent not to do so;

• to ensure sufficient liquidity for the plan;

• to ensure that plan investments are made in accordance with plan documents; and

• to consider whether an investment would constitute or give rise to a prohibited transaction under ERISA or the Internal Revenue Code.

ERISA also requires that, with certain exceptions, the assets of an employee benefit plan are held in trust and that the trustee, or a duly authorized named fiduciary or investment manager, have exclusive authority and discretion to manage and control the assets of the plan.

Prohibited Transactions

Generally, both ERISA and the Internal Revenue Code prohibit Benefit Plans from engaging in certain transactions involving plan assets with specified parties, such as sales or exchanges or leasing of property, loans or other extensions of credit, furnishing goods or services, or transfers to, or use of, plan assets. The specified parties are referred to as “parties-in-interest” under ERISA and as “disqualified persons” under the Internal Revenue Code. These definitions generally include both parties owning threshold percentage interests in an investment entity and “persons providing services” to the Benefit Plan, as well as employer sponsors of the Benefit Plan, fiduciaries and other individuals or entities affiliated with the foregoing. For this purpose, a person generally is a fiduciary with respect to a Benefit Plan if, among other things, the person has discretionary authority or control with respect to plan assets or provides investment advice for a fee with respect to plan assets. Under Department of Labor regulations, a person will be deemed to be providing investment advice if that person renders advice as to the advisability of

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investing in our shares, and that person regularly provides investment advice to the Benefit Plan pursuant to a mutual agreement or understanding that such advice will serve as the primary basis for investment decisions, and that the advice will be individualized for the Benefit Plan based on its particular needs. Thus, if we are deemed to hold plan assets, our management could be characterized as fiduciaries with respect to such assets, and each would be deemed to be a party-in-interest under ERISA and a disqualified person under the Internal Revenue Code with respect to investing Benefit Plans. Whether or not we are deemed to hold plan assets, if we or our affiliates are affiliated with a Benefit Plan Investor, we might be a disqualified person or party-in-interest with respect to such Benefit Plan Investor, resulting in a prohibited transaction merely upon investment by such Benefit Plan in our shares.

If a prohibited transaction were to occur, the Internal Revenue Code imposes an excise tax equal to 15% of the amount involved and authorizes the Internal Revenue Service to impose an additional 100% excise tax if the prohibited transaction is not “corrected” in a timely manner. These taxes would be imposed on any disqualified person who participates in the prohibited transaction. In addition, our board of directors, and possibly other fiduciaries of Benefit Plan shareholders subject to ERISA who permitted the prohibited transaction to occur or who otherwise breached their fiduciary responsibilities (or a non-fiduciary participating in a prohibited transaction), could be required to restore to the Benefit Plan any profits they realized as a result of the transaction or breach and make good to the Benefit Plan any losses incurred by the Benefit Plan as a result of the transaction or breach. With respect to an IRA that invests in our shares, the occurrence of a prohibited transaction involving the individual who established the IRA, or his or her beneficiary, would cause the IRA to lose its tax-exempt status under Section  408(e)(2) of the Internal Revenue Code.

Plan Asset Considerations

In order to determine whether an investment in our shares by a Benefit Plan creates or gives rise to the potential for either prohibited transactions or a commingling of assets as referred to above, a fiduciary must consider whether an investment in our shares will cause our assets to be treated as assets of the investing Benefit Plan. Neither ERISA nor the Internal Revenue Code defines the term “plan assets”; however, regulations promulgated by the Department of Labor provide guidelines as to whether, and under what circumstances, the underlying assets of an entity will be deemed to constitute assets of a Benefit Plan when the plan invests in that entity (Plan Assets Regulation). Under the Plan Assets Regulation, the assets of an entity in which a Benefit Plan makes an equity investment will generally be deemed to be assets of the Benefit Plan, unless one of the exceptions to this general rule applies.

In the event that our underlying assets were treated as the assets of investing Benefit Plans, our management would be treated as fiduciaries with respect to each Benefit Plan shareholder and an investment in our shares might constitute an ineffective delegation of fiduciary responsibility to our advisor, and expose the fiduciary of the Benefit Plan to co-fiduciary liability under ERISA for any breach by our advisor of the fiduciary duties mandated under ERISA. Further, if our assets are deemed to be “plan assets,” an investment by an IRA in our shares might be deemed to result in an impermissible commingling of IRA assets with other property.

If our advisor or its affiliates were treated as fiduciaries with respect to Benefit Plan shareholders, the prohibited transaction restrictions of ERISA and the Internal Revenue Code would apply to any transaction involving our assets. These restrictions could, for example, require that we avoid transactions with persons that are affiliated with or related to us or our affiliates or require that we restructure our activities in order to obtain an administrative exemption from the prohibited transaction restrictions. Alternatively, we might have to provide Benefit Plan shareholders with the opportunity to sell their shares to us or we might dissolve.

The Plan Assets Regulation provides that the underlying assets of an entity such as a REIT will be treated as assets of a Benefit Plan investing therein unless the entity satisfies one of the exceptions to the general rule. We believe that we will satisfy one or more of the exceptions described below.

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Exception for “Publicly-Offered Securities.” If a Benefit Plan acquires “publicly-offered securities,” the assets of the issuer of the securities will not be deemed to be “plan assets” under the Plan Assets Regulation. A publicly-offered security must be:

• either (i) part of a class of securities registered under the Exchange Act, or (ii) sold as part of a public offering registered under the Securities Act, and be part of a class of securities registered under the Exchange Act within a specified time period;

• part of a class of securities that is owned by 100 or more persons who are independent of the issuer and one another; and

• “freely transferable.”

Our shares are being sold as part of an offering of securities to the public pursuant to an effective registration statement under the Securities Act and are part of a class that will be registered under the Exchange Act within the specified period. In addition, we have in excess of 100 independent shareholders of our common stock.

Whether a security is “freely transferable” depends upon the particular facts and circumstances. The Plan Assets Regulation provides several examples of restrictions on transferability that, absent unusual circumstances, will not prevent the rights of ownership in question from being considered “freely transferable” if the minimum investment is $10,000 or less. Where the minimum investment in a public offering of securities is $10,000 or less, the presence of the following restrictions on transfer will not ordinarily affect a determination that such securities are “freely transferable”:

• any restriction on, or prohibition against, any transfer or assignment that would either result in a termination or reclassification of the entity for federal or state tax purposes or that would violate any state or federal statute, regulation, court order, judicial decree or rule of law;

• any requirement that not less than a minimum number of shares or units of such security be transferred or assigned by any investor, provided that such requirement does not prevent transfer of all of the then remaining shares or units held by an investor;

• any prohibition against transfer or assignment of such security or rights in respect thereof to an ineligible or unsuitable investor; and

• any requirement that reasonable transfer or administrative fees be paid in connection with a transfer or assignment.

We have been structured with the intent to satisfy the “freely transferable” requirement set forth in the Plan Assets Regulation with respect to our shares, although there is no assurance that our shares will meet such requirement. Our shares are subject to certain restrictions on transfer intended to ensure that we continue to qualify for federal income tax treatment as a REIT and to comply with state securities laws and regulations with respect to investor suitability. The minimum investment in our shares is less than $10,000; thus, these restrictions should not cause the shares to be deemed not “freely transferable.”

Our common stock is held by 100 or more independent shareholders, and assuming that no other facts and circumstances other than those referred to in the preceding paragraphs exist that restrict transferability of shares of our common stock and the offering takes place as described in this prospectus, shares of our common stock should constitute “publicly-offered securities” and, accordingly, we believe that our underlying assets should not be considered “plan assets” under the Plan Assets Regulation.

Exception for Insignificant Participation by Benefit Plan Investors. The Plan Assets Regulation provides that the assets of an entity will not be deemed to be the assets of a Benefit Plan if equity participation in the entity by Benefit Plan investors is not significant. The Plan Assets Regulation provides that equity participation in an entity by Benefit Plan investors is “significant” if at any time 25% or more of the value of any class of equity interest is held by Benefit Plan investors. The term “Benefit Plan investors” is defined for this purpose under ERISA Section 3(42) and the Plan Assets Regulation and includes any employee benefit plan subject to Part 4 of ERISA, any plan subject Section 4975 of the Internal Revenue Code, and any entity whose underlying assets include plan assets by reason of a plan’s investment in such entity. In calculating the value of a class of equity interests, the value of any equity interests held by us or any of our affiliates must be excluded. It is not clear whether we will qualify for this exception.

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Exception for Operating Companies. The Plan Assets Regulation provides an exception with respect to securities issued by an operating company, which includes a “real estate operating company” or a “venture capital operating company.” Generally, we will be deemed to be a real estate operating company if during the relevant valuation periods at least 50% of our assets are invested in real estate that is managed or developed and with respect to which we have the right to substantially participate directly in management or development activities. To constitute a venture capital operating company, 50% or more of our assets must be invested in “venture capital investments” during the relevant valuation periods. A venture capital investment is an investment in an operating company, including a “real estate operating company,” as to which the investing entity has or obtains direct management rights. If an entity satisfies this 50% assets requirement on the date it first makes a long-term investment (the “initial valuation date”), it will be considered a real estate operating company or a venture capital operating company, as the case may be, for the entire period beginning on the initial valuation date and ending on the last day of the first annual valuation period, provided that it actually exercises its management rights during such entire period. An “annual valuation period” is a pre-established annual period of not more than 90 days, and the first annual valuation period must begin no later than the anniversary of the initial valuation date. For subsequent periods, the entity must satisfy the 50% of assets test at some time during each annual valuation period and must exercise its management rights during the following 12 months. We believe that we will qualify for the real estate operating company exception; however, we have not obtained an opinion of counsel regarding such qualification.

Other Prohibited Transactions

Regardless of whether the shares qualify for an exception under the Plan Assets Regulation, a prohibited transaction could occur if we, any selected broker-dealer or any affiliates is a fiduciary (within the meaning of Section 3(21) of ERISA) with respect to any Benefit Plan purchasing our shares. Accordingly, unless an administrative or statutory exemption applies, shares should not be purchased by a Benefit Plan with respect to which any of the above persons is a fiduciary. A person is a fiduciary with respect to a Benefit Plan under Section 3(21) of ERISA if, among other things, the person has discretionary authority or control with respect to the Benefit Plan or “plan assets” or provides investment advice for a fee with respect to “plan assets.”

Annual Valuation

A fiduciary of an employee benefit plan subject to ERISA is required to determine annually the fair market value of each asset of the plan as of the end of the plan’s fiscal year and to file a report reflecting that value with the Department of Labor. When the fair market value of any particular asset is not available, the fiduciary is required to make a good faith determination of that asset’s fair market value, assuming an orderly liquidation at the time the determination is made. In addition, a trustee or custodian of an IRA must provide an IRA participant with a statement of the value of the IRA each year. Failure to satisfy these requirements may result in penalties, damages or other sanctions.

Unless and until our shares are listed on a national securities exchange, we do not expect that a public market for our shares will develop. To date, neither the Internal Revenue Service nor the Department of Labor has promulgated regulations specifying how a plan fiduciary should determine the fair market value of shares when the fair market value of such shares is not determined in the marketplace.

To assist broker-dealers who participate in this offering, we expect to provide an estimated value for our shares annually. Initially we will report the net investment amount of our shares, which will be based on the “amount available for investment/net investment amount” percentage shown in our estimated use of proceeds table, as our estimated value per share. No later than May 17, 2021, we will provide an NAV per share as our estimated value per share. This value will be based on valuations of our assets and liabilities performed at least annually, by, or with the material assistance or confirmation of, a third-party valuation expert or service . Once we announce an NAV per share, we generally expect to update the NAV per share annually.

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We can make no assurances that such estimated value will satisfy the applicable annual valuation requirements under ERISA and the Internal Revenue Code. The Department of Labor or the Internal Revenue Service may determine that a plan fiduciary or an IRA custodian is required to take further steps to determine the value of our common shares. In the absence of an appropriate determination of value, a plan fiduciary or an IRA custodian may be subject to damages, penalties or other sanctions.

The foregoing requirements of ERISA and the Internal Revenue Code are complex and subject to change. Plan fiduciaries and the beneficial owners of IRAs are urged to consult with their own advisors regarding an investment in our shares.

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DESCRIPTION OF SHARES

The following is a summary of the description of our capital stock. Copies of our charter and bylaws are filed as exhibits to this registration statement of which this prospectus is a part. See “Where You Can Find More Information.”

General

Our charter authorizes us to issue: (i) 1,000,000,000 shares of common stock, $0.01 par value per share and (ii) 100,000,000 shares of preferred stock of the total shares of common stock authorized, 500,000,000 shares are classified as Class A shares and 500,000,000 are classified as Class T shares. As of October 4, 2019, we had approximately 7,180,000 shares of our common stock outstanding and no shares of preferred stock outstanding. In addition, our board of directors may amend our charter to increase or decrease the amount of our authorized shares.

Common Stock

Unless otherwise specified, the description of our common stock refers to both our Class A and Class T shares of common stock. The holders of our common stock are entitled to one vote per share on all matters submitted to a shareholder vote, including the election of directors. Our charter does not provide for cumulative voting in the election of our directors. Therefore, the holders of a majority of our outstanding shares of common stock can elect our entire board of directors. Unless applicable law requires otherwise, and except as our charter may provide with respect to any series of preferred stock that we may issue in the future, the holders of our common stock will possess exclusive voting power.

Holders of our common stock are entitled to receive such distributions as may be declared from time to time by our board of directors out of legally available funds, subject to any preferential rights of any preferred stock that we issue in the future. In any liquidation, each outstanding share of common stock entitles its holder to share (based on the percentage of shares held) in the assets that remain after we pay our liabilities and any preferential distributions owed to preferred shareholders. Holders of shares of our common stock will not have preemptive rights, which means that you will not have an automatic option to purchase any new shares that we issue, nor will holders of our shares of common stock have any preference, conversion, exchange, sinking fund, redemption or appraisal rights. Our common stock will be non-assessable by us upon our receipt of the consideration for which our board of directors authorized its issuance.

Our board of directors has authorized the issuance of shares of our common stock without certificates. We will not issue shares in certificated form. Information regarding restrictions on the transferability of our shares that, under Maryland law, would otherwise have been required to appear on our share certificates will instead be furnished to shareholders upon request and without charge.

We maintain a stock ledger that contains the name and address of each shareholder and the number of shares that the shareholder holds. With respect to uncertificated stock, we will continue to treat the shareholder registered on our stock ledger as the owner of the shares until the new owner delivers a properly executed form to us, which form we will provide to any registered holder upon request.

With respect to each authorized and declared distribution, each outstanding share of common stock shall be entitled to receive the same amount.

Class A Shares

Our advisor pays the dealer manager selling commissions of up to 6% of the gross primary offering proceeds from the sale of our Class A common stock, all of which may be reallowed to participating broker-dealers. In addition, our advisor also pays the dealer manager a dealer manager fee up to 3% of the gross primary offering proceeds as compensation for acting as the dealer manager and for expenses incurred in connection with marketing our shares and wholesaler compensation. No upfront or deferred selling commissions or dealer manager fees are paid for Class A shares sold under our distribution reinvestment plan.

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Class T Shares

Our advisor pays the dealer manager selling commissions of up to 3% of the gross primary offering proceeds from the sale of our Class T common stock, all of which may be reallowed to participating broker-dealers. In addition, our advisor also pays the dealer manager a dealer manager fee up to 3% of the gross primary offering proceeds from the sale of our Class T common stock as compensation for acting as the dealer manager and for expenses incurred in connection with marketing our shares and wholesaler compensation. No upfront or deferred selling commissions or dealer manager fees are paid for Class T shares sold under our distribution reinvestment plan.

Subject to FINRA limitations on underwriting compensation and certain other limitations described below, our advisor will pay the dealer manager a deferred selling commission with respect to our outstanding Class T shares sold in the primary offering equal to 1.0% per annum of the estimated value per share for the Class T share for three years from the date on which such share is issued.

The deferred selling commission will accrue daily based on the number of Class T shares outstanding on each day that were sold in the primary offering within the previous three years of such date and be paid monthly in arrears. The dealer manager will reallow all of the deferred selling commissions to participating broker-dealers and servicing broker-dealers as described below. Class T shares purchased pursuant to our distribution reinvestment plan or received as a stock dividend are not subject to a deferred selling commission. Because our advisor has agreed to pay the deferred selling commissions and other underwriting compensation on our behalf without reimbursement by us, the deferred selling commission will have no impact on us or on holders of our Class T shares.

Payment of the deferred selling commissions with respect to individual Class T shares will cease when they are no longer outstanding, including as a result of conversion to Class A shares and redemption or repurchase. Each Class T share held in a shareholder’s account shall automatically and without any action on the part of the holder thereof convert into a Class A share, on the earliest to occur of the following: (i) a listing of the Class A shares on a national securities exchange; (ii) a merger or consolidation of our company with or into another entity, or the sale or other disposition of all or substantially all of our assets; and (iii) the last calendar day of the month in which we and our dealer manager, in conjunction with our transfer agent, determine that the deferred selling commission paid with respect to the Class T shares held by such shareholder within such account equals or exceeds three percent of the aggregate gross purchase price of the Class T shares held by such shareholder within such account and purchased in a primary offering. In addition, after termination of a primary offering registered under the Securities Act, payment of the deferred selling commission with respect to each Class T share sold in that primary offering will cease, on the date when we, with the assistance of our dealer manager, determine that all underwriting compensation paid or incurred with respect to the primary offering covered by that registration statement from all sources, determined pursuant to the rules and guidance of FINRA, would be in excess of 10% of the aggregate purchase price of all shares sold for our account through that primary offering. Further, each Class T share sold in that primary offering, each Class T share sold under a distribution reinvestment plan pursuant to the same registration statement that was used for that primary offering, and each Class T share received as a stock dividend with respect to such shares sold in such primary offering or distribution reinvestment plan shall automatically and without any action on the part of the holder thereof convert into a Class A share at the last calendar day of the month in which such determination is made. We cannot predict if or when certain of the foregoing events will occur. If we redeem a portion, but not all of the Class T shares held in a shareholder’s account, the underwriting compensation limit and amount of underwriting compensation previously paid will be prorated between the Class T shares that were redeemed and those Class T shares that were retained in the account. Likewise, if a portion of the Class T shares in a shareholder’s account is sold or otherwise transferred in a secondary transaction, the total underwriting compensation limit and amount of underwriting compensation previously paid will be prorated between the Class T shares that were transferred and the Class T shares that were retained in the account.

With respect to the conversion of Class T shares into Class A shares, each Class T share will convert without any action on the part of the holder thereof into a number of Class A shares equal to such Class T share multiplied by a fraction, the numerator of which is the most recent NAV per Class T share and the denominator of which is the most recent NAV per Class A share. Shareholders will receive notice that their Class T shares have been converted into Class A shares in accordance with industry practice at that time, which we expect to be either a transaction confirmation from the transfer agent, notification from the transfer agent or notification through the next account statement following the conversion. We currently expect that the conversion of each Class T share will be on a one-for-on basis, as we expect the NAV per share of each Class A share and Class T share will be the same as there are currently no class-specific expenses associated with the different share classes.

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Preferred Stock

Our charter authorizes our board of directors to designate and issue one or more classes or series of preferred stock without approval of our common shareholders. Our board of directors may determine the relative rights, preferences and privileges of each class or series of preferred stock so issued, which may be more beneficial than the rights, preferences, and privileges attributable to our common stock. The issuance of preferred stock could have the effect of delaying or preventing a change in control. Our board of directors has no present plans to issue preferred stock but may do so at any time in the future without shareholder approval.

Meetings and Special Voting Requirements

An annual meeting of our shareholders will be held each year, at least 30 days after delivery of our annual report. Special meetings of shareholders may be called only upon the request of a majority of our directors, a majority of our independent directors, our chief executive officer, our president or upon the written request of shareholders holding at least 10% of the shares entitled to be cast on any issue proposed to be considered at the special meeting. Upon receipt of a written request of common shareholders holding at least 10% of the shares entitled to be cast stating the purpose of the special meeting, our secretary will provide all of our shareholders written notice of the meeting and the purpose of such meeting. The meeting must be held not less than 15 days or more than 60 days after the distribution of the notice of the meeting. The presence in person or by proxy of shareholders entitled to cast 50% of all the votes entitled to be cast at any shareholder meeting constitutes a quorum. Unless otherwise provided by the Maryland General Corporation Law or our charter, the affirmative vote of a majority of all votes cast is necessary to take shareholder action. With respect to the election of directors, each candidate nominated for election to the board of directors must receive a majority of the votes present, in person or by proxy, in order to be elected. Therefore, if a nominee receives fewer “for” votes than “withhold” votes in an election, then the nominee will not be elected.

Our charter provides that the concurrence of the board is not required in order for the common shareholders to amend the charter, dissolve the corporation or remove directors. However, we have been advised that Section 2-604 and Section 3-403 of the Maryland General Corporation Law do require board approval in order to amend our charter or dissolve, respectively. Without the approval of a majority of the shares of common stock entitled to vote on the matter, the board of directors may not:

• amend the charter to adversely affect the rights, preferences and privileges of the common shareholders;

• amend charter provisions relating to director qualifications, fiduciary duties, liability and indemnification, conflicts of interest, investment policies or investment restrictions;

• cause our liquidation or dissolution after our initial investment in property;

• sell all or substantially all of our assets other than in the ordinary course of business; or

• cause our merger or reorganization.

The term of our advisory agreement with our advisor will end after one year but may be renewed for an unlimited number of successive one-year periods upon the mutual consent of our advisor and us. Our conflicts committee will review our advisory agreement with our advisor annually. While the shareholders do not have the ability to vote to replace our advisor or to select a new advisor, shareholders do have the ability, by the affirmative vote of a majority of the shares entitled to vote on such matter, to remove a director from our board.

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Advance Notice for Shareholder Nominations for Directors and Proposals of New Business

Our bylaws provide that with respect to an annual meeting of shareholders, nominations of individuals for election to the board of directors and the proposal of business to be considered by shareholders may be made only:

• pursuant to our notice of the meeting;

• by the board of directors; or

• by a shareholder who gives notice of the nomination or proposal not less than 90 days prior to the first anniversary of the date of the mailing of the notice for the preceding year’s annual shareholders’ meeting.

Our bylaws contain a similar notice requirement in connection with nominations for directors at a special meeting of shareholders called for the purpose of electing one or more directors. Failure to comply with the notice provisions will make shareholders unable to nominate directors or propose new business. The purpose of requiring shareholders to give us advance notice of nominations and other business is to afford our board of directors a meaningful opportunity to consider the qualifications of the proposed nominees and the advisability of any other proposed business and, to the extent deemed necessary or desirable by our board of directors, to inform shareholders and make recommendations about such qualifications or business, as well as to provide a more orderly procedure for conducting meetings of shareholders.

Inspection of Books and Records

Under Maryland law, a shareholder is entitled to inspect and copy (at all reasonable times) the following corporate documents: bylaws, minutes of the proceedings of shareholders, annual statements of affairs, voting trust agreements and stock records for certain specified periods. In addition, within seven days after a request for such documents is presented to an officer or our resident agent, we will have the requested documents available on file at our principal office. As a part of our books and records, we will maintain at our principal office an alphabetical list of the names of our common shareholders, along with their addresses and telephone numbers and the number of shares held by each of them. We will update this shareholder list at least quarterly. Except as noted below, the list will be available for inspection at our principal office by a common shareholder or his or her designated agent upon request of the shareholder and we will mail this list to any common shareholder within 10 days of receipt of his or her request. We may impose a reasonable charge for expenses incurred in reproducing such list. Shareholders, however, may not sell or use this list for a commercial purpose other than in the interest of the applicant as a shareholder relative to the affairs of our company. The purposes for which shareholders may request this list include matters relating to their voting rights. Each common shareholder who receives a copy of the shareholder list will keep such list confidential and share such list only with its employees, representatives or agents who agree in writing to maintain the confidentiality of the shareholder list.

If our advisor or our board of directors neglects or refuses to exhibit, produce or mail a copy of the shareholder list as requested, our advisor or board, as the case may be, will be liable to the common shareholder requesting the list for the costs, including attorneys’ fees, incurred by that shareholder for compelling the production of the shareholder list and any actual damages suffered by any common shareholder for the neglect or refusal to produce the list. It will be a defense that the actual purpose and reason for the requests for inspection or for a copy of the shareholder list is not for a proper purpose but is instead for the purpose of securing such list of shareholders or other information for the purpose of selling such list or copies thereof, or of using the same for a commercial purpose other than in the interest of the applicant as a shareholder relative to the affairs of our company. We may require that the shareholder requesting the shareholder list represent that the request is not for a commercial purpose unrelated to the shareholder’s interest in our company. The remedies provided by our charter to shareholders requesting copies of the shareholder list are in addition to, and do not in any way limit, other remedies available to shareholders under federal law, or the law of any state. As the operations of our operating partnership will be conducted by us, an inspection of the books and records would include an inspection of the books and records of our operating partnership.

Restriction on Ownership of Shares

Ownership Limit

To maintain our REIT qualification, not more than 50% in value of our outstanding shares may be owned, directly or indirectly, by five or fewer individuals (including certain entities treated as individuals under the Internal Revenue Code) during the last half of each taxable year. In addition, at least 100 persons who are independent of us and each other must beneficially own our outstanding shares for at least 335 days per 12-month taxable year or

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during a proportionate part of a shorter taxable year. Each of the requirements specified in the two preceding sentences will not apply to any period prior to the second year for which we elect to be taxable as a REIT. We may prohibit certain acquisitions and transfers of shares so as to ensure our continued qualification as a REIT under the Internal Revenue Code. However, we cannot assure you that this prohibition will be effective.

To help ensure that we meet these tests, our charter prohibits any person or group of persons from acquiring, directly or indirectly, beneficial ownership of more than 9.8% of our aggregate outstanding shares unless exempted by our board of directors. Our board of directors may waive this ownership limit with respect to a particular person if the board of directors receives evidence that ownership in excess of the limit will not jeopardize our REIT status. For purposes of this provision, we treat corporations, partnerships and other entities as single persons.

Any attempted transfer of our shares that, if effective, would result in a violation of our ownership limit or would result in our shares being owned by fewer than 100 persons will be null and void and will cause the number of shares causing the violation to be automatically transferred to a trust for the exclusive benefit of one or more charitable beneficiaries. The prohibited transferee will not acquire any rights in the shares. The automatic transfer will be deemed to be effective as of the close of business on the business day prior to the date of the attempted transfer. We will designate a trustee of the trust that will not be affiliated with us or the prohibited transferee. We will also name one or more charitable organizations as a beneficiary of the share trust.

Shares held in trust will remain issued and outstanding shares and will be entitled to the same rights and privileges as all other shares of the same class or series. The prohibited transferee will not benefit economically from any of the shares held in trust, will not have any rights to dividends or distributions, and will not have the right to vote or any other rights attributable to the shares held in the trust. The trustee will receive all dividends and distributions on the shares held in trust and will hold such dividends or distributions in trust for the benefit of the charitable beneficiary. The trustee may vote any shares held in trust.

Within 20 days of receiving notice from us that any of our shares have been transferred to the trust for the charitable beneficiary, the trustee will sell those shares to a person designated by the trustee whose ownership of the shares will not violate the above restrictions. Upon the sale, the interest of the charitable beneficiary in the shares sold will terminate and the trustee will distribute the net proceeds of the sale to the prohibited transferee and to the charitable beneficiary as follows. The prohibited transferee will receive the lesser of (i) the price paid by the prohibited transferee for the shares or, if the prohibited transferee did not give value for the shares in connection with the event causing the shares to be held in the trust (e.g., a gift, devise or other similar transaction), the market price (as defined in our charter) of the shares on the day of the event causing the shares to be held in the trust and (ii) the price received by the trustee from the sale or other disposition of the shares. Any net sale proceeds in excess of the amount payable to the prohibited transferee will be paid immediately to the charitable beneficiary. If, prior to our discovery that shares have been transferred to the trust, the shares are sold by the prohibited transferee, then (i) the shares will be deemed to have been sold on behalf of the trust and (ii) to the extent that the prohibited transferee received an amount for the shares that exceeds the amount he was entitled to receive, the excess will be paid to the trustee upon demand.

In addition, shares held in the trust for the charitable beneficiary will be deemed to have been offered for sale to us, or our designee, at a price per share equal to the lesser of (i) the price per share in the transaction that resulted in the transfer to the trust (or, in the case of a devise or gift, the market price at the time of the devise or gift) and (ii) the market price on the date we, or our designee, accept the offer. We will have the right to accept the offer until the trustee has sold the shares. Upon a sale to us, the interest of the charitable beneficiary in the shares sold will terminate and the trustee will distribute the net proceeds of the sale to the prohibited transferee.

Any person who acquires or attempts to acquire shares in violation of the foregoing restrictions or who would have owned the shares that were transferred to any such trust must give us immediate written notice of such event, and any person who proposes or attempts to acquire or receive shares in violation of the foregoing restrictions must give us at least 15 days’ written notice prior to such transaction. In both cases, such persons will provide to us such other information as we may request in order to determine the effect, if any, of such transfer on our status as a REIT.

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The foregoing restrictions will continue to apply until our board of directors determines it is no longer in our best interest to continue to qualify as a REIT. The ownership limit does not apply to any underwriter in an offering of our shares or to a person or persons exempted from the ownership limit by our board of directors based upon appropriate assurances that our qualification as a REIT would not be jeopardized.

Within 30 days after the end of each taxable year, every owner of 5% or more of our outstanding capital stock will be asked to deliver to us a statement setting forth the number of shares owned directly or indirectly by such person and a description of how such person holds the shares. Each such owner will also provide us with such additional information as we may request in order to determine the effect, if any, of his or her beneficial ownership on our status as a REIT and to ensure compliance with our ownership limit.

These restrictions could delay, defer or prevent a transaction or change in control of us that might involve a premium price for our shares of common stock or otherwise be in the best interests of our shareholders.

Suitability Standards and Minimum Purchase Requirements

State securities laws and our charter require that purchasers of our common stock meet standards regarding (i) net worth or income and (ii) minimum purchase amounts. These standards are described above at “Suitability Standards” immediately following the cover page of this prospectus and “Plan of Distribution—Minimum Purchase Requirements.” All subsequent sales must comply with applicable state and federal securities laws.

Distributions

We expect to pay distributions on a monthly basis. As further described below, during the early stages of our operations, it is likely that we will use sources of funds which may constitute a return of capital to fund distributions. Through June 30, 2019, we have paid distributions with offering proceeds. In the discretion of our board of directors, these distributions may be authorized and declared based on daily record dates or a single record date as of the end of the month. The rate will be determined by the board of directors based on our financial condition and such other factors as our board of directors deems relevant. The board of directors has not pre-established a percentage range of return for distributions to shareholders. We have not established a minimum distribution level, and our charter does not require that we make distributions to our shareholders.

Generally, our policy is to make distributions from cash flow from operations. However, we expect to have little, if any, cash flow from operations available for distribution until we make substantial investments. During our offering stage, when we may raise capital in this offering more quickly than we acquire income-producing assets, and for some period after our offering stage, we may not be able to make distributions solely from our cash flow from operations. Further, because we may receive income from interest or rents at various times during our fiscal year and because we may need cash flow from operations during a particular period to fund capital expenditures and other expenses, we expect that at least during the early stages of our development and from time to time during our operational stage, we will declare distributions in anticipation of cash flow that we expect to receive during a later period and we will pay these distributions in advance of our actual receipt of these funds. In addition, to the extent our investments are in development or redevelopment projects or in properties that have significant capital requirements, our ability to make distributions may be negatively impacted, especially during our early periods of operation. In these instances, we expect to look to third party borrowings to fund our distributions. We may also fund such distributions from the sale of assets or from the maturity, payoff or settlement of debt investments. Such distributions will likely exceed our earnings or cash flow from operations for the corresponding period. Our charter permits us to make distributions from any source, including offering proceeds or borrowings (which may constitute a return of capital), and our charter does not limit the amount of funds we may use from any source to pay such distributions. If we make distributions from sources other than our cash flow from operations, we will have less funds available for investment in properties and other assets.

To maintain our qualification as a REIT, we must make aggregate annual distributions to our shareholders of at least 90% of our REIT taxable income (which is computed without regard to the dividends-paid deduction or net capital gain and which does not necessarily equal net income as calculated in accordance with GAAP). If we meet the REIT qualification requirements, we generally will not be subject to federal income tax on the income that we distribute to our shareholders each year. See “Federal Income Tax Considerations – Annual Distribution Requirements.” Our board of directors may authorize distributions in excess of those required for us to maintain REIT status depending on our financial condition and such other factors as our board of directors deems relevant.

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Distributions that you receive will be taxed as ordinary income to the extent they are from current or accumulated earnings and profits. To the extent any portion of your distribution is not from current or accumulated earnings and profits, it will not be subject to tax immediately; it will be considered a return of capital for tax purposes and will reduce the tax basis of your investment (and potentially result in taxable gain upon your sale of the stock). Distributions that constitute a return of capital, in effect, defer a portion of your tax until your investment is sold or we are liquidated, at which time you will be taxed at capital gains rates. However, because each investor’s tax considerations are different, we suggest that you consult with your tax advisor.

Tender Offer by Shareholders

Our charter provides that any tender offer made by a shareholder, including any “mini-tender” offer, must comply with certain notice and disclosure requirements. These procedural requirements with respect to tender offers apply to any widespread solicitation for shares of our stock at firm prices for a limited time period.

In order for one of our shareholders to conduct a tender offer to another shareholder, our charter requires that the shareholder comply with Regulation 14D of the Exchange Act, and provide us with notice of such tender offer at least ten business days before initiating the tender offer. Pursuant to our charter, Regulation 14D would require any shareholder initiating a tender offer to provide:

• specific disclosure to shareholders focusing on the terms of the offer and information about the bidder;

• the ability to allow shareholders to withdraw tendered shares while the offer remains open;

• the right to have tendered shares accepted on a pro rata basis throughout the term of the offer if the offer is for less than all of our shares; and

• that all shareholders of the subject class of shares be treated equally.

In addition to the foregoing, there are certain ramifications to shareholders should they attempt to conduct a noncompliant tender offer. If any shareholder initiates a tender offer without complying with the provisions set forth above, all tendering shareholders will have the opportunity to rescind the tender of their shares to the non-complying offeror within 30 days of our provision of a position statement on such non-compliant tender offer to shareholder. The noncomplying shareholder shall also be responsible for all of our expenses in connection with that shareholder’s noncompliance.

Business Combinations

Under the Maryland General Corporation Law, business combinations between a Maryland corporation and an interested shareholder or the interested shareholder’s affiliate are prohibited for five years after the most recent date on which the shareholder becomes an interested shareholder. For this purpose, the term “business combination” includes mergers, consolidations, share exchanges, asset transfers, and issuances or reclassifications of equity securities. An “interested shareholder” is defined for this purpose as: (i) any person who beneficially owns 10% or more of the voting power of the corporation’s shares or (ii) an affiliate or associate of the corporation who, at any time within the two-year period prior to the date in question, was the beneficial owner of 10% or more of the voting power of the then outstanding voting shares of the corporation. A person is not an interested shareholder under the statute if the board of directors approved in advance the transaction by which he otherwise would have become an interested shareholder. However, in approving a transaction, the board of directors may provide that its approval is subject to compliance, at or after the time of approval, with any terms and conditions determined by the board of directors.

After the five-year prohibition, any business combination between the corporation and an interested shareholder generally must be recommended by the board of directors of the corporation and approved by the affirmative vote of at least: (i) 80% of the votes entitled to be cast by holders of outstanding voting shares of the corporation and (ii) two-thirds of the votes entitled to be cast by holders of voting shares of the corporation other than shares held by the interested shareholder or its affiliate with whom the business combination is to be effected, or held by an affiliate or associate of the interested shareholder.

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These super-majority vote requirements do not apply if the corporation’s common shareholders receive a minimum price, as defined under the Maryland General Corporation Law, for their shares in the form of cash or other consideration in the same form as previously paid by the interested shareholder for its shares.

None of these provisions of the Maryland General Corporation Law will apply, however, to business combinations that are approved or exempted by the board of directors of the corporation prior to the time that the interested shareholder becomes an interested shareholder. We have opted out of these provisions by resolution of our board of directors. However, our board of directors may, by resolution, opt in to the business combination statute in the future.

Control Share Acquisitions

The Maryland General Corporation Law provides that control shares of a Maryland corporation acquired in a control share acquisition have no voting rights except to the extent approved by a vote of two-thirds of the votes entitled to be cast on the matter. Shares owned by the acquirer, an officer of the corporation, or an employee of the corporation who is also a director of the corporation are excluded from the vote on whether to accord voting rights to the control shares. “Control shares” are voting shares that, if aggregated with all other shares owned by the acquirer or with respect to which the acquirer has the right to vote or to direct the voting of, other than solely by virtue of revocable proxy, would entitle the acquirer to exercise voting power in electing directors within one of the following ranges of voting power:

• one-tenth or more but less than one-third;

• one-third or more but less than a majority; or

• a majority or more of all voting power.

Control shares do not include shares the acquiring person is then entitled to vote as a result of having previously obtained shareholder approval. Except as otherwise specified in the statute, a “control share acquisition” means the acquisition of control shares.

Once a person who has made or proposes to make a control share acquisition has undertaken to pay expenses and has satisfied other required conditions, the person may compel the board of directors to call a special meeting of shareholders to be held within 50 days of the demand to consider the voting rights of the shares. If no request for a meeting is made, the corporation may itself present the question at any shareholders meeting.

If voting rights are not approved for the control shares at the meeting or if the acquiring person does not deliver an “acquiring person statement” for the control shares as required by the statute, the corporation may redeem any or all of the control shares for their fair value, except for control shares for which voting rights have previously been approved. Fair value is to be determined for this purpose without regard to the absence of voting rights for the control shares, and is to be determined as of the date of the last control share acquisition or of any meeting of shareholders at which the voting rights for control shares are considered and not approved.

If voting rights for control shares are approved at a shareholders meeting and the acquirer becomes entitled to vote a majority of the shares entitled to vote, all other shareholders may exercise appraisal rights. The fair value of the shares as determined for purposes of these appraisal rights may not be less than the highest price per share paid in the control share acquisition. Some of the limitations and restrictions otherwise applicable to the exercise of dissenters’ rights do not apply in the context of a control share acquisition.

The control share acquisition statute does not apply to shares acquired in a merger, consolidation or share exchange if the corporation is a party to the transaction or to acquisitions approved or exempted by the charter or bylaws of the corporation.

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Our bylaws contain a provision exempting from the control share acquisition statute any and all acquisitions by any person of our stock. There can be no assurance that this provision will not be amended or eliminated at any time in the future.

Subtitle 8

Subtitle 8 of Title 3 of the Maryland General Corporation Law permits a Maryland corporation with a class of equity securities registered under the Exchange Act, and at least three independent directors to elect to be subject, by provision in its charter or bylaws or a resolution of its board of directors and notwithstanding any contrary provision in the charter or bylaws, to any or all of five provisions:

• a classified board,

• a two-thirds vote requirement for removing a director,

• a requirement that the number of directors be fixed only by vote of the directors,

• a requirement that a vacancy on the board be filled only by the remaining directors and for the remainder of the full term of the directorship in which the vacancy occurred, and

• a majority requirement for the calling of a special meeting of shareholders.

Although our board has no current intention to opt in to any of the above provisions permitted under Maryland law, our charter does not prohibit our board from doing so. Becoming governed by any of these provisions could discourage an extraordinary transaction (such as a merger, tender offer or sale of all or substantially all of our assets) that might provide a premium price for holders of our securities. Note that through provisions in our charter and bylaws unrelated to Subtitle 8, we already vest in our board of directors the exclusive power to fix the number of directors. Our bylaws may be amended by our shareholders or the board of directors.

Distribution Reinvestment Plan

We have adopted a distribution reinvestment plan pursuant to which you may elect to have your dividends and other distributions reinvested in additional shares of common stock. Purchases pursuant to our distribution reinvestment plan will be in the same class of shares as the shares for which such shareholders received the distributions that are being reinvested. The following discussion summarizes the principal terms of this plan. Appendix B to this prospectus contains the full text of our distribution reinvestment plan as is currently in effect.

Eligibility

All of our common shareholders are eligible to participate in our distribution reinvestment plan; however, we may elect to deny your participation in the distribution reinvestment plan if you reside in a jurisdiction or foreign country where, in our judgment, the burden or expense of compliance with applicable securities laws makes your participation impracticable or inadvisable.

At any time prior to the listing of our shares on a national stock exchange, you must cease participation in our distribution reinvestment plan if you no longer meet the net income and net worth standards set forth in our charter or the then-current prospectus. Participants must agree to notify us promptly when they no longer meet these standards. See the “Suitability Standards” section of this prospectus (immediately following the cover page) and the form of subscription agreement attached hereto as Appendix A.

Election to Participate

You may elect to participate in the distribution reinvestment plan by completing the subscription agreement or other approved enrollment form available from the dealer manager or a soliciting dealer. Your participation in the distribution reinvestment plan will begin with the next distribution made after receipt of your enrollment form. You can choose to have all of your distributions reinvested through the distribution reinvestment plan. You may change your election at any time by completing a new enrollment form or other form provided for that purpose.

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Stock Purchases

Shares will be purchased under the distribution reinvestment plan on the distribution payment dates and will be in the same class of shares as the shares for which such shareholder received the distributions that are being reinvested. The purchase of fractional shares is a permissible and likely result of the reinvestment of distributions under the distribution reinvestment plan.

The purchase prices for both classes of shares purchased under the distribution reinvestment plan is $10.00 per share. Once we establish an NAV per share, shares issued pursuant to our distribution reinvestment plan will be priced at the NAV per share. We expect to establish an NAV per share no later than May 17, 2021.

Account Statements

You or your designee will receive a confirmation of your purchases under the distribution reinvestment plan no less than quarterly. Your confirmation will disclose the following information:

• each distribution reinvested for your account during the period;

• the date of the reinvestment;

• the number and price of the shares purchased by you; and

• the total number of shares in your account.

In addition, within 90 days after the end of each calendar year, we will provide you with an individualized report on your investment, including the purchase dates, purchase price, number of shares owned and the amount of distributions made in the prior year. We will also provide to all participants in the plan, without charge, all supplements to and updated versions of this prospectus, as required under applicable securities laws.

With respect to material changes, we may provide notice by including such information (a) in a Current Report on Form 8-K or in our annual or quarterly reports filed with the SEC and (b) in a separate mailing to the participants. With respect to immaterial changes, we may provide notice by including such information (a) in a Current Report on Form 8-K or in our annual or quarterly reports filed with the SEC, (b) in a separate mailing to the participants, or (c) on our web site.

Fees and Commissions and Use of Proceeds

No upfront or deferred selling commissions or dealer manager fees are payable on shares sold under the distribution reinvestment plan. We use the proceeds from the sale of shares under our distribution reinvestment plan for general corporate purposes, including, but not limited to, the following:

• the repurchase of shares under our share repurchase program;

• capital expenditures related to our investments in multifamily apartment communities and multifamily real estate-related assets;

• reserves required by any financings of our investments;

• acquisition of assets; and

• the repayment of debt.

We cannot predict with any certainty how much, if any, distribution reinvestment plan proceeds will be available for specific purposes.

Voting

You may vote all shares, including fractional shares that you acquire through the distribution reinvestment plan.

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Tax Consequences of Participation

If you elect to participate in the distribution reinvestment plan and are subject to federal income taxation, you will incur a tax liability for distributions allocated to you even though you have elected not to receive the distributions in cash but rather to have the distributions withheld and reinvested pursuant to the distribution reinvestment plan. Specifically, you will be treated as if you have received the distribution from us in cash and then applied such distribution to the purchase of additional shares. In addition, to the extent you purchase shares through our distribution reinvestment plan at a discount to their fair market value, you will be treated for tax purposes as receiving an additional distribution equal to the amount of the discount.

You will be taxed on the amount of such distribution as a dividend to the extent such distribution is from current or accumulated earnings and profits, unless we have designated all or a portion of the distribution as a capital gain distribution. See “Federal Income Tax Considerations—Taxation of Shareholders.” We will withhold 24% of the amount of dividends or distributions paid if you fail to furnish a valid taxpayer identification number, fail to properly report interest or distributions or fail to certify that you are not subject to withholding.

Termination of Participation

Once enrolled, you may continue to purchase shares under our distribution reinvestment plan until we have sold all of the shares registered in this offering, have terminated this offering or have terminated the distribution reinvestment plan. You may terminate your participation in the distribution reinvestment plan at any time by providing us with written notice. For your termination to be effective for a particular distribution, we must have received your notice of termination at least 10 business days prior to the last day of the fiscal period to which the distribution relates. If you participate in our share repurchase program, you will not be terminated from participating in the distribution reinvestment plan unless you indicate your desire to terminate your participation on your share repurchase form. Any transfer of your shares will effect a termination of the participation of those shares in the distribution reinvestment plan. We will terminate your participation in the distribution reinvestment plan to the extent that a reinvestment of your distributions would cause you to violate the ownership limit contained in our charter, unless you have obtained an exemption from the ownership limit from our board of directors.

Amendment or Termination of Plan

We may amend or terminate the distribution reinvestment plan for any reason at any time upon 10 days’ written notice to the participants, except we may not amend the distribution reinvestment plan to remove the right of a shareholder to terminate participation in the plan. With respect to material changes, we may provide notice by including such information (a) in a Current Report on Form 8-K or in our annual or quarterly reports filed with the SEC and (b) in a separate mailing to the participants. With respect to immaterial changes, we may provide notice by including such information (a) in a Current Report on Form 8-K or in our annual or quarterly reports filed with the SEC, (b) in a separate mailing to the participants, or (c) on our web site.

Share Repurchase Program

Our board of directors has adopted a share repurchase program that may enable you to sell your shares of common stock to us in limited circumstances. Subject to the limitations discussed below and in further detail in our share repurchase program document, repurchases will be made in the discretion of our board of directors. The terms on which we repurchase shares differs between repurchases upon the death or “complete disability” (as defined in the share repurchase program) of the shareholder (collectively referred to as “Exceptional Repurchases”) and all other repurchases (referred to as “Ordinary Repurchases”).

Eligible Shareholders

Our share repurchase program is intended to provide limited interim liquidity for our shareholders until a secondary market develops for our shares of common stock, at which time the program will terminate. No such market presently exists, and we cannot assure you that any market for your shares will ever develop. Our share repurchase program is generally available only for shareholders who have held their shares for at least one year and who acquired their shares directly from us or received their shares (directly or indirectly) through one or more

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non-cash transactions. In other words, once our shares are transferred for value by a shareholder, the transferee and all subsequent holders of the shares are not eligible to participate in our share repurchase program. These limits may prevent us from accommodating all repurchase requests made in any year.

There is no one-year holding requirement with respect to Exceptional Redemptions. In addition, our board of directors reserves the right, in its sole discretion, at any time and from time to time, to waive the one-year holding requirement in the event of other exigent circumstances such as bankruptcy or a mandatory distribution requirement under a shareholder’s IRA.

Redemption Prices

In the case of Ordinary Repurchases, upon the request of a shareholder, repurchases will be made in the discretion of our board of directors and at the following repurchase prices:

1. Beginning on the first anniversary of the acquisition date and prior to the third anniversary of the acquisition date, the purchase price for the repurchased shares will be equal to 85% of the estimated value per share;

2. Beginning on the third anniversary of the acquisition date and prior to the fifth anniversary of the acquisition date, the purchase price for the repurchased shares will be equal to 90% of the estimated value per share; and

3. Beginning on the fifth anniversary of the acquisition date and every year thereafter, the purchase price for the repurchased shares will be equal to 95% of the estimated value per share.

In the case of Exceptional Redemptions, upon the request of a shareholder or his or her estate, heir or beneficiary, repurchases will be made in the discretion of our board of directors and at the following repurchase prices:

1. Until the second anniversary of the acquisition date, the purchase price for the repurchased Shares will be equal to 95% of the estimated value per share; and

2. Following the second anniversary of the acquisition date, the purchase price for the repurchased Shares will be equal to the estimated value per share.

For the purposes of our share repurchase program, the “estimated value per share” will initially be equal to the purchase price per share at which the original purchaser of the shares bought its shares from us, and the purchase price per share will be adjusted to reflect any stock dividends, combinations, splits, recapitalizations or any similar transaction with respect to the shares outstanding. We plan to establish an estimated NAV per share of our common stock based on valuations of our assets and liabilities no later than May 17, 2021, and annually thereafter. Upon our establishment of an estimated NAV per share, the estimated NAV per share will be the estimated value per share pursuant to our share repurchase program. For more details on how our board of directors will determine the NAV, see “Risk Factors – Risks Related to This Offering and Our Corporate Structure.”

For purposes of determining the time period a redeeming shareholder has held each share, the time period begins as of the acquisition date; provided, that the shares purchased by the redeeming shareholder pursuant to our distribution reinvestment plan will be deemed to have been acquired on the same date as the initial share to which the distribution reinvestment plan shares relate.

Limitations on Redemptions

There are several limitations on our ability to repurchase shares under our share repurchase program:

• Unless the shares are being repurchased in connection with an Exceptional Redemption, we generally may not repurchase shares unless the shareholder has held the shares for at least one year.

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• During any calendar year, we may repurchase no more than 5% of the weighted-average number of shares of our common stock outstanding during the prior calendar year (the “5% Limit”).

• During any calendar year, we may redeem only the number of shares that we could purchase with the amount of net proceeds from the sale of shares under our distribution reinvestment plan during the prior calendar year (the “DRP Limit”). Notwithstanding anything contained in this paragraph to the contrary, we may increase or decrease the funding available for the redemption of shares pursuant to our share repurchase program upon 15 days’ notice to our shareholders. We may provide notice by including such information (i) in a Current Report on Form 8-K or in its annual or quarterly reports, all publicly filed with the Securities and Exchange Commission, (ii) in a separate mailing to shareholders, or (iii) during this offering, in a prospectus supplement.

• We have no obligation to repurchase shares if the repurchase would violate the restrictions on distributions under Maryland law, which prohibits distributions that would cause a corporation to fail to meet statutory tests of solvency.

Special Provisions for Exceptional Repurchases

Repurchase upon complete disability will only be available to shareholders who become completely disabled after the purchase of their shares. If the shares are purchased by joint owners, the repurchase upon complete disability or death will be available when either joint owner first becomes completely disabled or dies.

Our board of directors, in its sole discretion, will determine in good faith whether a shareholder becomes completely disabled based on the definition of “disabled” under the federal Social Security Act. The federal Social Security Act generally defines disabled or disability as the inability to engage in any substantial gainful activity because of a medically determinable physical or mental impairment(s) that either (i) can be expected to result in death or (ii) has lasted or that we can expect to last for a continuous period of not less than 12 months. Our board of directors may rely on a determination made by the Social Security Administration’s office in the shareholder’s state in making its determination that the shareholder’s medical condition is considered a disability under the Social Security Act.

General Terms for Repurchase

Unless otherwise approved by our board of directors in its sole discretion, we will repurchase shares on the last business day of each quarter; provided, however we will not repurchase shares on the same day we make a dividend payment. Qualifying shareholders who desire to redeem their shares would have to give written notice to us by completing a repurchase request form and returning it to us at Cottonwood Communities, Inc., c/o DST Systems, Inc. We or our transfer agent must receive your written request for repurchase at least five business days before the repurchase date in order for us to repurchase your shares on the repurchase date.

If we could not repurchase all shares presented for repurchase in any quarter in which we are repurchasing shares, then we will repurchase all shares on a pro rata basis during the relevant quarter. If we did not completely satisfy a shareholder’s repurchase request on a repurchase date because we or our transfer agent did not receive the request in time or because of the restrictions on the number of shares we could repurchase under the program, we would treat the unsatisfied portion of the repurchase request as a request for repurchase at the next repurchase date funds are available for repurchase unless the shareholder withdrew his or her request before the next date for repurchases. Any shareholder could withdraw a repurchase request upon written notice to us if such notice were received by us at least five business days before the date for repurchases.

In general, and unless otherwise approved by our board of directors in its sole discretion, a shareholder may present to us fewer than all of the shares then owned for repurchase, except that the minimum number of shares that must be presented for repurchase must be at least 25% of the shareholder’s shares. If, however, an Exceptional Repurchase is being requested, or a repurchase is requested by a shareholder due to other exigent circumstances, such as bankruptcy or a mandatory distribution requirement under such shareholder’s IRA, a minimum of 10% of the shareholder’s shares may be presented for repurchase; provided, however, that unless otherwise approved by our board of directors in its sole discretion, any future repurchase request by such shareholder must relate to at least 25% of the shareholder’s remaining shares.

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In the event a shareholder will own fewer than 100 shares as a result of a repurchase request, we will redeem all of the shares held by such shareholder in order to avoid having shareholders holding fewer than 100 shares. Such repurchases will count against the 5% Limit but will not count against the DRP Limit.

Neither any member of our board of directors, nor our advisor or sponsor, nor any of their affiliates will receive any fee on our repurchase of shares pursuant to our share repurchase program.

Termination, Suspension or Amendment of our Share Repurchase Program

Our board of directors may amend, suspend or terminate our share repurchase program for any reason upon 15 days’ notice to our shareholders. We may provide notice by including such information (i) in a Current Report on Form 8-K or in our annual or quarterly reports, all publicly filed with the Securities and Exchange Commission, (ii) in a separate mailing to shareholders, or (iii) during this offering, in a prospectus supplement.

If we suspend our share repurchase program (in whole or in part), except as otherwise provided by our board of directors, until the suspension is lifted, we will not accept any requests for the repurchase of shares to which such suspension applies in subsequent periods and any such requests and all pending requests that are subject to the suspension will not be honored or retained, but will be returned to the requesting shareholder and must be resubmitted when the program is resumed.

Liability

Neither we nor our board of directors will have any liability to any shareholder for any damages resulting from or related to the shareholder’s presentment of the shareholder’s shares. Further, shareholders will have complete responsibility for payment of all taxes, assessments and other applicable obligations and third party costs resulting from or relating to our repurchase of shares.

Restrictions on Roll-Up Transactions

A Roll-up Transaction is a transaction involving the acquisition, merger, conversion or consolidation, directly or indirectly, of us and the issuance of securities of an entity that is created or would survive after the successful completion of a Roll-up Transaction, which we refer to as a Roll-up Entity. This term does not include:

• a transaction involving our securities that have been for at least 12 months listed on a national securities exchange; or

• a transaction involving only our conversion into a trust or association if, as a consequence of the transaction, there will be no significant adverse change in the voting rights of our common shareholders, the term of our existence, the compensation to our advisor or our investment objectives.

In connection with any proposed Roll-up Transaction, an appraisal of all our assets will be obtained from a competent independent expert. Our assets will be appraised on a consistent basis, and the appraisal will be based on an evaluation of all relevant information and will indicate the value of our assets as of a date immediately preceding the announcement of the proposed Roll-up Transaction. If the appraisal will be included in a prospectus used to offer the securities of a Roll-Up Entity, the appraisal will be filed with the SEC and, if applicable, the states in which registration of such securities is sought, as an exhibit to the registration statement for the offering. The appraisal will assume an orderly liquidation of assets over a 12-month period. The terms of the engagement of the independent expert will clearly state that the engagement is for our benefit and the benefit of our shareholders. A summary of the appraisal, indicating all material assumptions underlying the appraisal, will be included in a report to our shareholders in connection with any proposed Roll-up Transaction.

In connection with a proposed Roll-up Transaction, the person sponsoring the Roll-up Transaction must offer to our common shareholders who vote “no” on the proposal the choice of:

(1) accepting the securities of the Roll-up Entity offered in the proposed Roll-up Transaction; or

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(2) one of the following:

(A) remaining as common shareholders of us and preserving their interests in us on the same terms and conditions as existed previously; or

(B) receiving cash in an amount equal to the shareholders’ pro rata share of the appraised value of our net assets.

We are prohibited from participating in any proposed Roll-up Transaction:

• that would result in our common shareholders having democracy rights in a Roll-up Entity that are less than those provided in our charter and bylaws with respect to the election and removal of directors and the other voting rights of our common shareholders, annual and special meetings of common shareholders, the amendment of our charter and our dissolution;

• that includes provisions that would operate to materially impede or frustrate the accumulation of shares by any purchaser of the securities of the Roll-up Entity, except to the minimum extent necessary to preserve the tax status of the Roll-up Entity, or that would limit the ability of an investor to exercise the voting rights of its securities of the Roll-up Entity on the basis of the number of shares of common stock that such investor has held in us;

• in which investors’ rights of access to the records of the Roll-up Entity would be less than those provided in our charter and described in the section of this prospectus entitled “Description of Shares—Inspection of Books and Records”; or

• in which any of the costs of the Roll-up Transaction would be borne by us if the Roll-up Transaction would not be approved by our common shareholders.

Registrar and Transfer Agent

We have engaged a third party to serve as the registrar and transfer agent for our common stock. The name and address of our transfer agent is as follows:

DST Systems, Inc.

1055 Broadway, 7th Floor

Kansas City, Missouri 64105

Attn: Group Vice President-Full Service

Fax: (816) 435-3455

To ensure that any account changes or updates are made promptly and accurately, all changes and updates should be directed to the transfer agent, including any change to a shareholder’s address, ownership type, or distribution mailing address, as well as shareholder repurchase requests under our share repurchase program.

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THE OPERATING PARTNERSHIP AGREEMENT

General

Cottonwood Communities O.P., LP which we refer to as the operating partnership, is a recently formed Delaware limited partnership. We expect to own substantially all of our assets and conduct our operations through the operating partnership. We are the sole general partner of our operating partnership. As the general partner, we have the exclusive power to manage and conduct the business of the operating partnership. Currently, the sole limited partner of the operating partnership is Cottonwood Communities Investor, LLC, a wholly owned subsidiary of Cottonwood Residential O.P. Cottonwood Communities Investor, LLC has assigned its right in the promotional interest in our partnership to Cottonwood Advisors Promote, LLC.

As we accept subscriptions for shares in this offering, we transfer all of the proceeds of the offering to our operating partnership as a capital contribution in exchange for units of general partnership interest. Because we are the only general partner in the operating partnership, we do not have multiple classes of operating partnership interests that correspond to our classes of common stock. However, in the future we may issue new classes of operating partnership interests with unique terms, preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications and terms or conditions of redemption.

As a result of this structure, we are considered an UPREIT, or an umbrella partnership real estate investment trust. For purposes of satisfying the asset and income tests for qualification as a REIT, the REIT’s proportionate share of the assets and income of the operating partnership will be deemed to be assets and income of the REIT.

If we ever decide to acquire properties in exchange for units of limited partnership interest in the operating partnership, we expect to amend the partnership agreement of our operating partnership to allow for such contributions.

Capital Contributions

We have contributed $200,000 to the partnership in exchange for our general partner interest. Cottonwood Communities Investor, LLC, is not required to make a capital contribution in exchange for its limited partnership interest. We plan to contribute the proceeds of this offering to the operating partnership as an additional capital contribution. If we offer preferred shares in the future, the operating partnership will also issue preferred general partnership interests. In addition, if we accept contributions of property in our operating partnership, our percentage ownership interest in the operating partnership will be adjusted to reflect the relative ownership percentages of the property contributors and us. If the operating partnership would require additional funds at any time in excess of capital contributions made by us or from borrowings, we could borrow funds from a financial institution or other lender and lend such funds to the operating partnership on the same terms and conditions as are applicable to our borrowing of such funds.

Operations

The partnership agreement of our operating partnership will provide that, so long as we remain qualified as a REIT, the operating partnership will be operated in a manner that will enable us to satisfy the requirements for being classified as a REIT for tax purposes.

Distributions and Allocations of Profits and Losses

Cash from Operations (which includes cash from capital transactions) from our operating partnership is distributed as follows:

(1) First, 100% to the general partner (us) until our shareholders have received distributions in an aggregate amount equal to the sum of (i) a 6% cumulative, non-compounded, annual return on their invested capital and (ii) a return of their invested capital; and

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(2) Thereafter, 85% to the general partner (us) and 15% to Cottonwood Communities Advisors Promote, LLC.

Notwithstanding the above, upon the sale or exchange of the last property or liquidation of the operating partnership, Cottonwood Communities Advisors Promote, LLC will contribute prior income tax related distributions it has received from the operating partnership to the extent that the tax distributions cause Cottonwood Communities Advisors Promote, LLC to receive distributions that exceed the amount that would have been distributed to Cottonwood Communities Advisors Promote, LLC if Cottonwood Communities Advisors Promote, LLC did not receive such distributions.

The operating partnership will make allocations of income and loss so that the allocations are made in a similar manner to the distributions. Losses will not be passed through to our shareholders.

Rights, Obligations and Powers of the General Partner

Under the partnership agreement of our operating partnership, the general partner has all power and authority as a general partner is able to have under the Delaware Revised Uniform Limited Partnership Act, as amended. We are the sole general partner of our operating partnership. As the sole general partner, we have complete and exclusive discretion to manage and control the operating partnership’s business and to make all decisions affecting its assets.

We expect that the operating partnership would continue to pay all of the administrative and operating costs and expenses it incurs in acquiring or originating and operating and managing our investments. Other than the organizational and offering expenses paid by CC Advisors III, LLC, we expect the operating partnership would also pay all of our administrative costs and expenses and such expenses would be treated as expenses of the operating partnership. Such expenses would include:

• all expenses relating to our continuity of existence;

• all expenses associated with the preparation and filing of our periodic reports under federal, state, or local laws or regulations; and

• all of our other operating or administrative costs incurred in the ordinary course of business.

Other than the organizational and offering expenses paid by CC Advisors III, LLC, the only costs and expenses we could incur that the operating partnership would not reimburse would be costs and expenses relating to assets we may own outside of the operating partnership. We would pay the expenses relating to such assets directly.

Change in General Partner

We generally would not be able to withdraw as the general partner of our Operating Partnership or transfer our general partnership interest in our operating partnership (unless we transferred our interest to a wholly owned subsidiary).

Amendment of Limited Partnership Agreement

The partnership agreement of our operating partnership may be amended with our consent as general partner. It is anticipated that the partnership agreement of our operating partnership will be amended and restated if additional limited partners are admitted.

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SUPPLEMENTAL SALES MATERIAL

In addition to this prospectus, we may utilize additional sales materials in connection with the offering of the shares, although only when accompanied by or preceded by the delivery of this prospectus. The supplemental sales material will not contain all of the information material to an investment decision and should only be reviewed after reading this prospectus. These supplemental sales materials may include:

• investor sales promotion brochures;

• cover letters transmitting the prospectus;

• brochures containing a summary description of the offering;

• fact sheets describing the general nature of Cottonwood Communities, Inc. and our investment objectives;

• asset flyers describing our recent acquisitions;

• broker updates;

• online investor presentations;

• web site material;

• electronic media presentations; and

• client seminars and seminar advertisements and invitations.

All of the foregoing material will be prepared by us, our dealer manager, or their affiliates with the exception of the third-party article reprints. In certain jurisdictions, some or all of such sales material may not be available. In addition, the sales material may contain certain quotes from various publications without obtaining the consent of the author or the publication for use of the quoted material in the sales material.

We are offering shares only by means of this prospectus. Although the information contained in our supplemental sales materials will not conflict with any of the information contained in this prospectus, the supplemental materials do not purport to be complete and should not be considered a part of or as incorporated by reference in this prospectus or the offering statement of which this prospectus is a part.

LEGAL MATTERS

The validity of the shares of our common stock being offered hereby has been passed upon for us by DLA Piper LLP (US), Raleigh, North Carolina. DLA Piper LLP (US) has also reviewed the statements relating to certain federal income tax matters that are likely to be material to United States holders of our common stock under the caption “Federal Income Tax Considerations” and has opined upon our qualification as a REIT for federal income tax purposes.

WHERE YOU CAN FIND MORE INFORMATION

We have filed a registration statement on Form S-11 with the SEC with respect to the shares of our common stock to be issued in this offering. This prospectus is a part of that registration statement and, as permitted by SEC rules, does not include all of the information you can find in the registration statement or the exhibits to the registration statement. For additional information relating to us, we refer you to the registration statement and the exhibits to the registration statement. Statements contained in this prospectus as to the contents of any contract or document are necessarily summaries of such contract or document and in each instance, if we have filed the contract or document as an exhibit to the registration statement, we refer you to the copy of the contract or document filed as an exhibit to the registration statement.

We file annual, quarterly and special reports, proxy statements and other information with the SEC. We intend to furnish our shareholders with annual reports containing consolidated financial statements certified by an independent public accounting firm. The registration statement is, and any of these future filings with the SEC will be available to the public over the Internet at the SEC’s web site at http://www.sec.gov. You may read and copy any filed document at the SEC’s public reference room in Washington, D.C. at 100 F. Street, N.E., Room 1580, Washington, D.C. Please call the SEC at (800) SEC-0330 for further information about the public reference room.

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INDEX OF APPENDICES

APPENDIX A	FORM OF SUBSCRIPTION AGREEMENT	A-1
APPENDIX B	AMENDED AND RESTATED DISTRIBUTION REINVESTMENT PLAN	B-1
APPENDIX C	PRIOR PERFORMANCE TABLES	C-1

APPENDIX A

FORM OF SUBSCRIPTION AGREEMENT

A-1

Cottonwood Communities, Inc.     

SUBSCRIPTION AGREEMENT & INVESTOR INSTRUCTIONS

If you need assistance in completing this Subscription Agreement or have questions on trades in process, please call 844.422.2584.

Send Subscriptions and Checks made payable to “Cottonwood Communities, Inc” to: DST Systems, Inc. Attn: Cottonwood Communities, Inc. 430 W. 7th Street Suite # 219065 Kansas City, MO 64105 Phone: 844.422.2584 Fax: 855.338.1452	Send Funds by Wire to: Account Name: Cottonwood Communities, Inc. UMB Bank, N.A. 1010 Grand Blvd., 4th Floor, Kansas City, MO 64106 ABA #: 101000695 DDA #: 98-7229-2529 FCC: Investor Name
*  Cash, cashier’s checks/official bank checks, temporary checks, foreign checks, money orders, third party checks, or travelers checks are not accepted. 1. INVESTMENT INFORMATION

State of Sale:                                                                                    Amount of Subscription: $                                                   ☐   Shares are being purchased through a Registered Investment Advisor or fee-based account, not available for Class T share purchases.

Investment Type:
	☐   Initial Investment (Minimum Subscription: $5,000) ☐   Additional Investment (No Minimum Subscription Amount)
Share Class:	☐   Class A                        ☐   Class T
See the Prospectus, as amended and supplemented to date, for information about the different share classes. 2. INVESTMENT TYPE (check one box)

Non-Qualified	☐	Individual	☐	Partnership(2)
	☐	Joint Tenants with Right of Survivorship	☐	C Corporation(2)
	☐	Tenants in Common	☐	S Corporation(2)
	☐	Trust(1)	☐	Limited Liability Company(2)
	☐	Community Property	☐	Other:
	☐	Uniform Gift to Minors Act: State of
	☐	Uniform Transfer to Minors Act: State of
Qualified	☐	Traditional (Individual) IRA(3)	☐	Pension or Profit Sharing Plan(1)
	☐	Simple IRA(3)	☐	KEOGH Plan(1)
	☐	SEP IRA(3)	☐	Other:
	☐	ROTH IRA(3)
	☐	Beneficial as Beneficiary for:

(1)   Please attach a trustee certification or pages of the trust/plan document which lists the names of the trust/plan and trustees authorized to sign on behalf of the trust/plan. (2)   Please attach evidence of authority to sign on behalf of the entity.	(3)   Please submit this Subscription Agreement to Custodian of record prior to submitting to DST Systems.
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Cottonwood Communities,^™ Inc. Subscription Agreement & Investor Instructions

Custodian Information (to be completed by Custodian)

Name of Custodian:                                                                                                                                                    

Street Address:                                                                                                                                                            

City, State, Zip:                                                                                     Phone No.:                                                   

Custodian Tax ID No.:                          Custodian Account No.:                                                                  

3. INVESTOR INFORMATION

Section A: For Individuals, Community Property, Joint Tenants, Tenants in Common, & IRA accounts

Name(s):
Mailing Address:	City, State, Zip:
E-mail Address (Required):
Phone: Home: (          )	Mobile: (          )
Social Security or Federal Tax ID Number (“TIN”):	Date of Birth:
Joint Owner Social Security Number or TIN:	Joint Owner Date of Birth:
Section B: For Trust, Partnership, LLC, and Corporation accounts
Name of Trust or Entity:
TIN of Trust or Entity:	Date of Formation:
Name of Trustee(s) or Authorized Person(s):
Social Security Number(s) or TIN:	Date(s) of Birth:
Mailing Address:	E-mail Address:
Phone: Home: (          )	Mobile: (          )

Please provide a copy of your Trust, entity or Plan documents with this subscription.

Please check one of the following options for delivery of investor information:

☐ By checking this box, Cottonwood Communities, Inc. (the “Company”) will send certain investor communications to you in electronic form to the e-mail address provided in this Section 3. Investor communications that may be delivered electronically include account statements, tax forms, annual reports, proxy statements and other communications. By electing electronic delivery, you: (i) agree that you have the appropriate hardware and software to receive e-mail notifications and view PDF documents; (ii) understand that you may incur certain costs associated with downloading and printing investor documents; and (iii) understand that electronic delivery also involves risks related to system or network outages that could impair your timely receipt of or access to your documents. The Company may choose to send one or more items to you in paper form despite your consent to electronic delivery. You may also request a paper copy of any particular investor document. Your consent will be effective until you revoke it in writing to the Company.

☐ By checking this box, the Company will send all investor communications to you in paper form.

4. DISTRIBUTIONS (indicate to whom distributions should be sent)

By executing this Subscription Agreement, you hereby authorize the Company or its agent (DST Systems) to initiate entries into the account listed below or to send funds directly to the financial institution/individual(s) listed below. This authorization will remain in effect until you notify the Company or DST Systems in writing to cancel it with time to afford a reasonable opportunity to act on it. This authorization relates solely to this investment. Please select one of the options below:

☐ I choose to have my distributions to be directly deposited into my bank account. [Attach voided check and complete information below] ☐ I choose to have checks sent to the person(s) or financial institution listed below. [Distributions for custodial accounts will be sent to Custodian of record] ☐ I choose to have checks sent to the individual(s) listed in Section 3. ☐ I choose to participate in the Distribution Reinvestment Plan, as described in the prospectus.

Bank, Brokerage Firm or Person:
Mailing Address:
Account Type:	Account Number:
ABA Routing Number:

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Cottonwood Communities,^™ Inc. Subscription Agreement & Investor Instructions

5. INVESTOR SUITABILITY REQUIREMENTS

Please carefully read and separately initial each of the representations below for items 1-5. Except in the case of fiduciary accounts, you may not grant any person a power of attorney to make such representations on your behalf. As used below, “net worth” should be calculated exclusive of home, home furnishings and personal automobile, and unless otherwise indicated below, “liquid net worth” is defined as that portion of net worth that consists of cash, cash equivalents and readily marketable securities. References to “accredited investor” below mean an accredited investor as defined in Regulation D under the Securities Act of 1933, as amended. If you elect to participate in the Distribution Reinvestment Plan, the Company requests that if at any time you fail to meet the minimum income or net worth standards established for the Company as set forth in the prospectus or listed in this Section 5, you will promptly notify the Company in writing of that fact. Only sign items 6-18 if applicable.

In order to induce the Company to accept this subscription, I hereby represent and warrant to you as follows:

		OWNER	JOINT OWNER
1.	I have received the final prospectus for the Company.	☐             initials	☐             initials
2.	I have (i) a minimum net worth of at least $250,000 or (ii) a minimum net worth of at least $70,000 and a minimum annual gross income of at least $70,000, and, if applicable, I meet the higher net worth and gross income requirements imposed by my state of primary residence as set forth in the final prospectus under “Suitability Standards.”	☐             initials	☐             initials
3.	I acknowledge that there is no public market for the shares and, thus, my investment in shares is not liquid.	☐             initials	☐             initials
4.	I am purchasing the shares for my own account.	☐             initials	☐             initials
5.	I acknowledge that I will not be admitted as a stockholder until my investment has been accepted.	☐             initials	☐             initials
6.	If I am an Alabama, Kentucky, Missouri, or Oregon investor, my investment in the Company and its affiliates does not exceed 10% of my liquid net worth.	☐             initials	☐             initials
7.	If I am an Idaho investor, I have either (a) a liquid net worth of at least $300,000 or (b) gross annual income of at least $85,000 and a liquid net worth of at least $85,000. In addition, my investment in the Company does not exceed 10% of my liquid net worth.	☐             initials	☐             initials
8.	If I am a Kansas investor, I acknowledge that it is recommended by the Kansas Securities Commissioner that Kansas investors do not invest, in the aggregate, more than 10% of their liquid net worth in the Company and other non-traded real estate investment trusts.	☐             initials	☐             initials
9.	If I am a Maine investor, I acknowledge that it is recommended by the Maine Office of Securities that investors not invest, in the aggregate, more than 10% of their liquid net worth in the Company and similar direct participation investments.	☐             initials	☐             initials
10.	If I am a Massachusetts investor, my investment in the Company and other illiquid direct participation programs does not exceed 10% of my liquid net worth.	☐             initials	☐             initials
11.	If I am a Nebraska investor, my investment in the Company and the securities of other non-publicly traded REITs is equal to no more than 10% of my net worth. A Nebraska investor who is an accredited investor is not subject to the foregoing limitations.	☐             initials	☐             initials
12.	If I am a New Jersey investor, I have either (i) a minimum liquid net worth of at least $100,000 and a minimum annual gross income of not less than $85,000, or (ii) a minimum liquid net worth of at least $350,000. In addition, I have not invested more than 10% of my liquid net worth in the Company, its affiliates, and non-publicly traded direct investment programs (including REITs, business development companies, oil and gas programs, equipment leasing programs and commodity pools, but excluding unregistered, federally and state exempt private offerings).	☐             initials	☐             initials
13.	If I am a New Mexico investor, my investment in the Company, its affiliates and other non-traded real estate investment trusts does not exceed 10% of my liquid net worth.	☐             initials	☐             initials
14.	If I am a California, North Dakota, Pennsylvania, or Tennessee investor, I have a net worth of at least 10 times my investment in the Company.	☐             initials	☐             initials
15.	If I am an Ohio investor, my investment in the Company, its affiliates and other non-traded real estate investment trusts does not exceed 10% of my liquid net worth (that portion of net worth (total assets exclusive of primary residence, home furnishings, and automobiles, minus total liabilities) comprised of cash, cash equivalents, and readily marketable securities).	☐             initials	☐             initials
16.	If I am a Vermont investor, my investment in the Company does not exceed 10% of my liquid net worth. For these purposes, “liquid net worth” is defined as an investor’s total assets (not including home, home furnishings, or automobiles) minus total liabilities. A Vermont investor who is an accredited investor is not subject to the foregoing limitations.	☐             initials	☐             initials
17.	If I am an Iowa investor, I have either (i) an annual gross income of at least $100,000 and a net worth of at least $100,000, or (ii) a net worth of at least $350,000. In addition, I have not invested more than 10% of my net worth in the Company and in the securities of other non-publicly traded real estate investment trusts (REITs). An Iowa investor who is an accredited investor is not subject to the foregoing concentration limit.	☐             initials	☐             initials
18.	If I am a Puerto Rico investor, I have not invested more than 10% of my liquid net worth (that portion of net worth (total assets exclusive of primary residence, home furnishings, and automobiles minus total liabilities) consisting of cash, cash equivalents, and readily marketable securities) in the Company, its affiliates, and other non-traded REITs.	☐             initials	☐             initials
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Cottonwood Communities,^™ Inc. Subscription Agreement & Investor Instructions

6. INVESTOR SIGNATURES

THE UNDERSIGNED INVESTOR HEREBY CERTIFIES THAT ALL OF THE INFORMATION AND REPRESENTATIONS SET FORTH HEREIN ARE TRUE AND CORRECT IN ALL RESPECTS. THE UNDERSIGNED INVESTOR HAS THE AUTHORITY TO ENTER INTO THIS SUBSCRIPTION AGREEMENT ON BEHALF OF THE PERSON(S) OR ENTITY REGISTERED IN SECTION 3 ABOVE.

TAXPAYER IDENTIFICATION/SOCIAL SECURITY NUMBER CONFIRMATION (required): Under penalties of perjury, I certify that: (1) the number shown in Section 3 above is my correct TIN (or I am waiting for a number to be issued to me); (2) I am not subject to backup withholding because (a) I am exempt from backup withholding, or (b) I have not been notified by the Internal Revenue Service (“IRS”) that I am subject to backup withholding as a result of failure to report all interest or dividends, or (c) the IRS has notified me that I am no longer subject to backup withholding; (3) I am a U.S. citizen or other U.S. person (defined in the Form W-9 instructions). (Certification instructions: You must cross out item (2) above if you have been notified by the IRS that you are currently subject to backup withholding because you have failed to report all interest and dividends on your tax return.) I hereby agree to notify the Company within thirty (30) days of the date I become a foreign person. I understand that this certification may be disclosed to the IRS and the state taxing authority and that any false statement made herein could be punished by fine, imprisonment or both. The IRS does not require your consent to any provision of this document other than the certificates required to avoid backup withholding. Any investor that is not a U.S. citizen or other U.S. person (defined in the Form W-9 instructions) must provide the applicable completed Form W-8.

Executed this        day of                     ,                 .

SIGNATURE (INVESTOR OR AUTHORIZED SIGNATORY)	JOINT OWNER SIGNATURE (INVESTOR OR AUTHORIZED SIGNATORY)
Printed Name	Printed Name
Title (if applicable)	Title (if applicable)

*CUSTODIAL APPROVAL:

By executing this Subscription Agreement, Custodian certifies to the Company that the shares purchased pursuant to this Subscription Agreement are held for the benefit of the investor named in Section 3 of this Subscription Agreement (the “Beneficial Owner”); Custodian agrees to notify the Company promptly, but in any event within 30 days, of any changes in the name of the Beneficial Owner or the number of shares held by Custodian for the benefit of the Beneficial Owner; Custodian confirms that the Company is entitled to rely on these representations for the purposes of determining the shareholders entitled to notice of or to vote at each annual or special meeting of shareholders of the Company until delivery by Custodian to the Company of a written statement revoking such representations (provided, however, that any such revocation delivered after the record date or the closing of the stock transfer books of the Company in respect of any annual or special meeting of the shareholders, but on or prior to the date of such annual or special meeting of shareholders, shall not be effective until after the holding of such annual or special meeting of shareholders of the Company), then each Beneficial Owner (and not Custodian) will be deemed the holder of record for the shares of common stock entitled to notice of or to vote at each annual or special meeting of shareholders.

SIGNATURE (CUSTODIAN’S AUTHORIZED SIGNATORY)

Printed Name

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Cottonwood Communities,^™ Inc. Subscription Agreement & Investor Instructions

7. BROKER-DEALER OR REGISTERED INVESTMENT ADVISOR—REPRESENTATIONS AND WARRANTIES

The investor’s registered representative (“Registered Representative”) of a participating broker-dealer (“Broker-Dealer”) or an authorized representative of the investor’s Registered Investment Adviser (“RIA”), as applicable, must sign below to complete the order. The Registered Representative hereby warrants that he or she and the Broker-Dealer are duly licensed and may lawfully sell shares of common stock in the state designated as the investor’s legal residence. The RIA represents that it is either registered under the Investment Advisers Act of 1940 or exempt from registration. The Broker-Dealer or RIA, as applicable, agrees to maintain records of the information used to determine that an investment in shares of common stock of the Company is suitable and appropriate for the investor for a period of six years. The undersigned confirms by his or her signature that the Broker-Dealer or RIA, as applicable, (i) has reasonable grounds to believe that the information and representations concerning the investor identified herein are true, correct and complete in all respects; (ii) has discussed such investor’s prospective purchase of shares with such investor; (iii) has advised such investor of all pertinent facts with regard to the liquidity and marketability of the shares and other fundamental risks related to the investment in the shares; (iv) has delivered the final prospectus to such investor; (v) has reasonable grounds to believe that the investor is purchasing these shares for his or her own account; and (vi) has reasonable grounds to believe that the purchase of shares is a suitable investment for such investor, that such investor meets the suitability standards applicable to such investor as set forth in the final prospectus, as supplemented from time to time, and that such investor is in a financial position to enable such investor to realize the benefits of such an investment and to suffer any loss that may occur with respect thereto. I understand this Subscription Agreement is for Cottonwood Communities, Inc.

All sales of shares of common stock must be made through a Broker-Dealer. If a RIA has introduced a sale, the sale must be conducted through (i) the RIA in its capacity as a Registered Representative, if applicable; (ii) a Registered Representative of a Broker-Dealer that is affiliated with the RIA, if applicable; or (iii) if neither (i) or (ii) is applicable, an unaffiliated Broker-Dealer.

FOR SALES THROUGH AN RIA OR FEE-BASED ACCOUNT (please check one of the following as applicable):

☐  You are a RIA that has introduced a sale and are affiliated with a Broker-Dealer.

☐  You are a RIA that has introduced a sale and are not affiliated with a Broker-Dealer.

Broker-Dealer Firm Name (if applicable):	CRD No.:
Broker-Dealer Address:
City:                                                               State:                                                                    Zip Code:
Business Phone:(        )                              Operations E-mail Address:                                                       Fax No.:(         )
Registered Representative Name:                                                                                      Rep. No.:                                                                                                           (Please Print) Or
RIA Name:                                                                                      RIA No.:                                                                                                                                (Please Print)
Registered Representative’s or RIA’s Branch Address:
City:                                                           State:                                                            Zip Code:
Branch Phone Number: (        )                                                                                       Rep/RIA E-mail Address:

SIGNATURE OF REGISTERED REPRESENTATIVE OR REGISTERED INVESTMENT ADVISOR	Date
BROKER-DEALER PRINCIPAL APPROVAL SIGNATURE (if required)	Date

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If you need assistance completing the subscription

documents, please call: 844.422.2584

www.cottonwoodcommunities.com

6340 South 3000 East, Suite 500

Salt Lake City, UT 84121

Phone 855.816.9112 | Fax 801.278.0756

Securities Offered Through Orchard Securities, LLC Member FINRA/SiPC

8/19 CC-1006-E

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APPENDIX B

AMENDED AND RESTATED DISTRIBUTION REINVESTMENT PLAN

Cottonwood Communities, Inc., a Maryland corporation (the “Company”), has adopted this Amended and Restated Distribution Reinvestment Plan (the “DRP”), the terms and conditions of which are set forth below. Capitalized terms shall have the same meaning as set forth in the Company’s charter, as amended and supplemented, unless otherwise defined herein.

1. Amount of Shares Issuable. Up to an aggregate of $75,000,000 in shares in any combination of Class A and Class T Common Stock (the “Shares”) is authorized for issuance under the DRP.

2. Participants. “Participants” are holders of the Company’s shares of any class of Common Stock who elect to participate in the DRP regardless of the offering in which such Participant acquired their shares.

3. Distribution Reinvestment. Exclusive of distributions that the Company’s board of directors designates as ineligible for reinvestment through this DRP, the Company will apply that portion (as designated by a Participant) of the distributions (“Distributions”) declared and paid in respect of a Participant’s shares of any class of Common Stock to the purchase of additional Shares for such Participant. Purchases will be in the same class of Shares as the shares for which such Participant received the distributions that are being reinvested. Selling commissions, dealer manager fees and deferred selling commissions will not be paid on the Shares purchased in the DRP.

4. Procedures for Participation. Qualifying shareholders may elect to become Participants or to increase participation in the DRP by completing and executing the Subscription Agreement, an enrollment form or any other Company-approved authorization form as may be available from the Company, the dealer manager or soliciting dealers. Participation in the DRP will begin with the next Distribution payable after receipt of a Participant’s subscription agreement, enrollment form or other Company-approved authorization form.

5. Purchase of Shares. Shares will be purchased on the date that the Company makes a Distribution. Distributions will be paid upon the terms as authorized and declared by the Company’s board of directors. Until the Company establishes an estimated net asset value (“NAV”) per share of Common Stock, Participants will acquire the Shares at a price of $10.00 per share. Upon the Company’s announcement in a public filing with the Securities and Exchange Commission that the Company has established an estimated NAV per share of Common Stock, Participants will acquire Common Stock at a price equal to the estimated NAV per share of Common Stock. The Company expects to establish an estimated NAV per share of Common Stock no later than May 17, 2021. Participants in the DRP may purchase fractional shares so that 100% of the Distributions will be used to acquire shares. However, a Participant will not be able to acquire shares under the DRP to the extent such purchase would cause it to exceed limits set forth in the Company’s charter, as amended.

6. Taxation of Distributions. The reinvestment of Distributions in the DRP does not relieve Participants of any taxes that may be payable as a result of those Distributions and their reinvestment pursuant to the terms of this DRP.

7. Share Certificates. The Shares issuable under the DRP shall be uncertificated until the board of directors determines otherwise.

8. Voting of DRP Shares. In connection with any matter requiring the vote of the Company’s shareholders, each Participant will be entitled to vote all Shares, including fractional Shares, acquired by the Participant through the DRP.

9. Reports. Within 90 days after the end of the calendar year, the Company shall provide each Participant with (i) an individualized report on the Participant’s investment, including the purchase date(s), purchase price and number of shares owned, as well as the amount of Distributions received during the prior year; and (ii) all material information regarding the DRP and the effect of reinvesting distributions, including the tax consequences thereof. The Company shall provide such information reasonably requested by the dealer manager or a soliciting dealer, in order for the dealer manager or soliciting dealer to meet its obligations to deliver written notification to Participants of the information required by Rule 10b-10(b) promulgated under the Securities Exchange Act of 1934.

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10. Termination by Participant. A Participant may terminate participation in the DRP at any time by delivering to the Company a written notice. To be effective for any Distribution, such notice must be received by the Company at least ten business days prior to the last day of the month to which the Distribution relates. Any transfer of shares by a Participant will terminate participation in the DRP with respect to the transferred shares. Upon termination of DRP participation, Distributions will be distributed to the shareholder in cash.

11. Amendment or Termination of DRP by the Company. The Company may amend or terminate the DRP for any reason upon ten days’ written notice to the Participants, except the Company may not amend the DRP to remove the right of a Participant to terminate participation in the DRP. With respect to material changes, the Company may provide notice by including such information (a) in a Current Report on Form 8-K or in its annual or quarterly reports filed with the SEC, and (b) in a separate mailing to the Participants. With respect to immaterial changes, the Company may provide notice by including such information (a) in a Current Report on Form 8-K or in its annual or quarterly reports filed with the SEC, (b) in a separate mailing to the Participants, or (c) on the Company’s web site.

12. Liability of the Company. The Company shall not be liable for any act done in good faith, or for any good faith omission to act.

13. Governing Law. The DRP shall be governed by the laws of the State of Maryland.

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APPENDIX C

PRIOR PERFORMANCE TABLES

The following prior performance tables provide information relating to the real estate investment programs sponsored by Cottonwood Residential II, Inc., Cottonwood Residential, Inc., Cottonwood Residential O.P., LP and their affiliates, collectively referred to herein as the “prior real estate programs.” These programs were not prior programs of Cottonwood Communities, Inc. Prior to the commencement of its plan to liquidate and restructure its subsidiaries that was completed in September 2018, Cottonwood Residential, Inc. was a real estate investment trust that, through its affiliates and subsidiaries, and in particular, through Cottonwood Residential O.P., LP, its operating partnership, provided real estate investment and management services and acted as the initial sponsor of this offering. In September 2018, Cottonwood Residential II, Inc. was admitted as an additional general partner of Cottonwood Residential O.P., LP along with Cottonwood Residential, Inc., as a nominal general partner, and directs the investment activities of Cottonwood Residential O.P., LP going forward. We consider Cottonwood Residential II, Inc. to be our current sponsor. As the leadership of Cottonwood Residential, Inc. remains intact at Cottonwood Residential II, Inc. we have continued to provide information regarding real estate investment programs sponsored by Cottonwood Residential, Inc. Cottonwood Capital Property Management II, Inc., an indirect subsidiary of Cottonwood Capital Management, Inc., and Cottonwood Residential, Inc., sponsored Cottonwood Multifamily REIT I, Inc. and Cottonwood Multifamily REIT II, Inc. which are real estate investment trusts that have investment objectives similar to us. The other prior programs consisted of tenant in common offerings which had investment objectives that targeted investors who were completing tax deferred exchanges under Section 1031 of the Internal Revenue Code of 1986, as amended, and entities that were formed to accept the contribution of tenant in common interests in property in exchange for interests in such entity. Thus, while these prior programs acquired multifamily real estate, the investment objectives of such prior programs were not similar to those of Cottonwood Communities, Inc.

This information should be read together with the summary of information included in the “Prior Performance Summary” section of this prospectus.

INVESTORS SHOULD NOT CONSTRUE INCLUSION OF THE FOLLOWING TABLES AS IMPLYING, IN ANY MANNER, THAT WE WILL HAVE RESULTS COMPARABLE TO THOSE REFLECTED IN SUCH TABLES. DISTRIBUTABLE CASH FLOW, FEDERAL INCOME TAX DEDUCTIONS OR OTHER FACTORS COULD BE SUBSTANTIALLY DIFFERENT. INVESTORS SHOULD NOTE THAT, BY ACQUIRING OUR SHARES, THEY WILL NOT BE ACQUIRING ANY INTEREST IN ANY PRIOR PROGRAM.

Description of the Tables

All information contained in the Tables in this Appendix C is as of December 31, 2018. The following tables are included herein:

Table I – Experience in Raising and Investing Funds

Table III – Annual Operating Results of Prior Real Estate Programs

Table IV – Operating Results of Prior Real Estate Programs Which Have Completed Operations

Table III includes information regarding the last five prior programs offered by Cottonwood Residential O.P., LP and its affiliates. Table IV includes information regarding the last five completed prior programs offered by Cottonwood Residential O.P., LP and its affiliates.

We have not included in this Appendix C Table II (Compensation to Sponsor) or Table V (Sale or Disposition of Properties by Prior Real Estate Programs) because the information contained in these tables is not applicable to the prior programs.

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TABLE I

EXPERIENCE IN RAISING AND INVESTING FUNDS

(UNAUDITED)

Table I sets forth the experience in raising and investing funds of prior real estate programs whose offerings closed during the three years ending December 31, 2018. All figures are as of December 31, 2018.

	Cottonwood Multifamily REIT I, Inc.
Dollar amount offered	$	50,000,000
Dollar amount raised	$	50,000,000
Length of Offering		9 months
Months to invest 90% of amount available for investment		<1 month
	Cottonwood Multifamily REIT II, Inc.
Dollar amount offered	$	50,000,000
Dollar amount raised	$	50,000,000
Length of Offering		13 months
Months to invest 90% of amount available for investment		18 months

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TABLE III

ANNUAL OPERATING RESULTS OF PRIOR PROGRAMS

(UNAUDITED)

Table III sets forth the annual operating results of prior real estate programs during the five years ending December 31, 2018. All figures are as of December 31, 2018 (amounts in dollars and thousands). All of the offerings for the prior real estate programs described in this Table III have closed.

Cottonwood Multifamily REIT I	2014		2015		2016			2017			2018
Summary Balance Sheet Data at December 31,
Total assets (before depreciation)		—		10		51,921			50,833			47,831
Total assets (after depreciation)		—		10		48,784			43,134			36,796
Liabilities		—		—		(24,444	)		(2,162	)		(421	)
Summary Income Statement Data (1)
Gross revenues		—		—		4,344			10,778			11,405
Operating expenses		—		—		(1,859	)		(4,737	)		(4,695	)
Operating income		—		—		2,485			6,041			6,710
Interest expense		—		—		(2,106	)		(2,995	)		(3,132	)
Non-operating, including depreciation and amortization		—		—		(3,584	)		(5,871	)		(5,239	)
Net loss		—		—		(3,205	)		(2,825	)		(1,661	)
Summary Cash Flows Data (1)
Cash provided by (used in) operating activities		—		—		—			1,243			(86	)
Cash (used in) provided by investing activities		—		—		(48,199	)		—			3,747
Cash provided by (used in) financing activities		—		10		50,570			(3,333	)		(2,990	)
Net increase (decrease) in cash		—		—		2,371			(2,090	)		671
Amount and Source of Distributions
Distributions from operations		—		—		259			2,714			2,875
Distributions from financing		—		—		—			—			3,747
Distributions from sales		—		—		—			—			—
Distributions from offering proceeds		—		—		—			—			—

⁽¹⁾  Operating results and cash flow data include Cottonwood Multifamily REIT I’s share of property activity based on its ownership interests in real estate joint ventures.

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TABLE III

ANNUAL OPERATING RESULTS OF PRIOR PROGRAMS

(UNAUDITED)

Table III sets forth the annual operating results of prior real estate programs during the five years ending December 31, 2018. All figures are as of December 31, 2018 (amounts in dollars and thousands). All of the offerings for the prior real estate programs described in this Table III have closed.

Cottonwood Multifamily REIT II	2014		2015		2016		2017			2018
Summary Balance Sheet Data at December 31,
Total assets (before depreciation)		—		—		10		16,166			47,977
Total assets (after depreciation)		—		—		10		16,166			46,480
Liabilities		—		—		—		(73	)		(233	)
Summary Income Statement Data (1)
Gross revenues		—		—		—		—			1,830
Operating expenses		—		—		—		—			(761	)
Operating income		—		—		—		—			1,069
Interest expense		—		—		—		—			(471	)
Non-operating, including depreciation and amortization		—		—		—		(11	)		(1,653	)
Net loss		—		—		—		(11	)		(1,055	)
Summary Cash Flows Data (1)
Cash used in operating activities		—		—		—		(2	)		(725	)
Cash used in investing activities		—		—		—		—			(19,365	)
Cash provided by financing activities		—		—		10		15,888			32,067
Net increase in cash		—		—		10		15,886			11,977
Amount and Source of Distributions
Distributions from operations		—		—		—		—			—
Distributions from financing		—		—		—		69			1,907
Distributions from sales		—		—		—		—			—
Distributions from offering proceeds		—		—		—		—			—

⁽¹⁾  Operating results and cash flow data include Cottonwood Multifamily REIT II’s share of property activity based on its ownership interests in real estate joint ventures.

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TABLE III

ANNUAL OPERATING RESULTS OF PRIOR PROGRAMS

(UNAUDITED)

Table III sets forth the annual operating results of prior real estate programs during the five years ending December 31, 2018. All figures are as of December 31, 2018 (amounts in dollars and thousands). All of the offerings for the prior real estate programs described in this Table III have closed.

Toscana at Valley Ridge	2014		2015			2016			2017			2018
Summary Balance Sheet Data at December 31,
Total assets (before depreciation)		—		31,114			31,631			31,418			31,362
Total assets (after depreciation)		—		30,636			30,059			28,723			27,521
Liabilities		—		(19,911	)		(19,929	)		(19,828	)		(19,617	)
Summary Income Statement Data (1)
Gross revenues		—		1,250			3,079			3,432			3,546
Operating expenses		—		(630	)		(1,384	)		(1,436	)		(1,522	)
Operating income		—		620			1,695			1,996			2,024
Interest expense		—		(358	)		(834	)		(831	)		(851	)
Non-operating, including depreciation and amortization		—		(1,284	)		(1,224	)		(1,117	)		(1,144	)
Net loss		—		(1,021	)		(363	)		48			29
Summary Cash Flows Data (1)
Cash used in operating activities		—		690			1,805			1,196			1,205
Cash (used in) provided by investing activities		—		(13	)		(634	)		601			(320	)
Cash used in financing activities		—		(43	)		—			(102	)		—
Net increase in cash		—		635			1,171			1,695			885
Amount and Source of Distributions
Distributions from operations		—		—			200			1,252			1,013
Distributions from financing		—		—			—			—			—
Distributions from sales		—		—			—			—			—
Distributions from offering proceeds		—		—			—			—			—

⁽¹⁾  Operating results and cash flow data represent 100% of the property results from Cottonwood Residential O.P., LP’s initial acquisition date forward.

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TABLE III

ANNUAL OPERATING RESULTS OF PRIOR PROGRAMS

(UNAUDITED)

Table III sets forth the annual operating results of prior real estate programs during the five years ending December 31, 2018. All figures are as of December 31, 2018 (amounts in dollars and thousands). All of the offerings for the prior real estate programs described in this Table III have closed.

Scott Mountain	2014			2015			2016			2017			2018
Summary Balance Sheet Data at December 31,
Total assets (before depreciation)		25,363			40,239			40,275			41,093			41,395
Total assets (after depreciation)		21,884			39,403			37,947			37,163			35,827
Liabilities		(15,640	)		(23,837	)		(23,877	)		(34,606	)		(34,593	)
Summary Income Statement Data (1)
Gross revenues		3,144			3,567			3,965			4,451			4,576
Operating expenses		(1,433	)		(1,427	)		(1,441	)		(1,504	)		(1,547	)
Operating income		1,711			2,140			2,525			2,947			3,029
Interest expense		(791	)		(834	)		(869	)		(1,149	)		(1,507	)
Non-operating, including depreciation and amortization		(850	)		(2,474	)		(1,478	)		(1,569	)		(1,586	)
Net income (loss)		70			(1,168	)		177			229			(64	)
Summary Cash Flows Data (1)
Cash provided by operating activities		865			1,564			1,664			1,798			1,644
Cash used in investing activities		(354	)		(393	)		(1,103	)		(540	)		(186	)
Cash provided by (used in) financing activities		(260	)		7,364			—			10,400			—
Net increase in cash		250			8,535			561			11,658			1,458
Amount and Source of Distributions
Distributions from operations		125			49			880			1,218			1,260
Distributions from financing		—			6,643			721			10,400			—
Distributions from sales		—			—			—			—			—
Distributions from offering proceeds		—			—			—			—			—

⁽¹⁾  Operating results and cash flow data represent 100% of the property results from Cottonwood Residential O.P., LP’s initial acquisition date forward.

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TABLE III

ANNUAL OPERATING RESULTS OF PRIOR PROGRAMS

(UNAUDITED)

Table III sets forth the annual operating results of prior real estate programs during the five years ending December 31, 2018. All figures are as of December 31, 2018 (amounts in dollars and thousands). All of the offerings for the prior real estate programs described in this Table III have closed.

Courtney Oaks	2014			2015			2016			2017			2018
Summary Balance Sheet Data at December 31,
Total assets (before depreciation)		1,125			38,157			38,658			47,270			49,566
Total assets (after depreciation)		N/A			37,432			36,569			43,718			43,718
Liabilities		(238	)		(24,527	)		(24,597	)		(24,346	)		(39,386	)
Summary Income Statement Data
Gross revenues		567			3,451			3,718			3,992			4,977
Operating expenses		(205	)		(1,325	)		(1,326	)		(1,447	)		(1,796	)
Operating income		362			2,126			2,392			2,545			3,181
Interest expense		(138	)		(538	)		(1,042	)		(1,039	)		(1,282	)
Non-operating, including depreciation and amortization		(353	)		(2,812	)		(1,394	)		(1,498	)		(1,906	)
Net income (loss)		(129	)		(1,224	)		(44	)		8			(7	)
Summary Cash Flows Data
Cash provided by operating activities		418			1,604			1,382			1,507			1,924
Cash used in investing activities		(88	)		(408	)		(362	)		(609	)		(219	)
Cash provided by (used in) financing activities		(57	)		7,391			—			—			—
Net increase (decrease) in cash		272			8,587			1,021			898			1,705
Amount and Source of Distributions
Distributions from operations		—			226			339			883			1,118
Distributions from financing		—			7,391			532			—			14,496
Distributions from sales		—			—			—			—			—
Distributions from offering proceeds		—			—			—			—			—

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TABLE III

ANNUAL OPERATING RESULTS OF PRIOR PROGRAMS

(UNAUDITED)

Table III sets forth the annual operating results of prior real estate programs during the five years ending December 31, 2018. All figures are as of December 31, 2018 (amounts in dollars and thousands). All of the offerings for the prior real estate programs described in this Table III have closed.

Summer Park	2014			2015			2016			2017			2018
Summary Balance Sheet Data at December 31,
Total assets (before depreciation)		40,592			41,683			41,240			41,958			51,242
Total assets (after depreciation)		40,226			40,322			38,828			38,438			50,794
Liabilities		(21,274	)		(22,965	)		(23,029	)		(23,068	)		(36,345	)
Summary Income Statement Data
Gross revenues		1,505			4,313			4,599			5,123			1,503
Operating expenses		(586	)		(1,677	)		(1,825	)		(2,065	)		(562	)
Operating income		919			2,636			2,774			3,057			941
Interest expense		(403	)		(1,091	)		(858	)		(858	)		(465	)
Non-operating, including depreciation and amortization		(438	)		(1,641	)		(1,108	)		(1,171	)		(1,355	)
Net income (loss)		78			(97	)		808			1,028			(879	)
Summary Cash Flows Data
Cash provided by operating activities		418			1,565			1,977			2,051			2,129
Cash used in investing activities		(135	)		(193	)		(805	)		(288	)		(199	)
Cash provided by (used in) financing activities		(164	)		1,726			—			—			—
Net increase in cash		119			3,098			1,173			1,763			1,930
Amount and Source of Distributions
Distributions from operations		403			588			1,258			1,449			2,234
Distributions from financing		—			1,384			342			—			12,361
Distributions from sales		—			—			—			—			—
Distributions from offering proceeds		—			—			—			—			—

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TABLE III

ANNUAL OPERATING RESULTS OF PRIOR PROGRAMS

(UNAUDITED)

Table III sets forth the annual operating results of prior real estate programs during the five years ending December 31, 2018. All figures are as of December 31, 2018 (amounts in dollars and thousands). All of the offerings for the prior real estate programs described in this Table III have closed.

Cottonwood Bayview	2014		2015		2016			2017			2018
Summary Balance Sheet Data at December 31,
Total assets (before depreciation)		—		—		78,286			76,841			77,492
Total assets (after depreciation)		—		—		78,183			74,221			72,338
Liabilities		—		—		(50,043	)		(50,369	)		(50,292	)
Summary Income Statement Data (1)
Gross revenues		—		—		179			3,362			7,009
Operating expenses		—		—		(48	)		(1,450	)		(3,049	)
Operating income		—		—		131			1,912			3,960
Interest expense		—		—		(55	)		(963	)		(1,942	)
Non-operating, including depreciation and amortization		—		—		(679	)		(3,124	)		(2,539	)
Net income (loss)		—		—		(603	)		(2,175	)		(521	)
Summary Cash Flows Data
Cash provided by operating activities		—		—		—			1,105			2,062
Cash used in investing activities		—		—		—			(239	)		(155	)
Cash provided by financing activities		—		—		—			—			—
Net increase in cash		—		—		—			1,105			1,907
Amount and Source of Distributions
Distributions from operations		—		—		—			1,563			1,285
Distributions from financing		—		—		—			—			—
Distributions from sales		—		—		—			—			—
Distributions from offering proceeds		—		—		—			—			—

⁽¹⁾  Operating results and cash flow data represent 100% of the property results from Cottonwood Residential O.P., LP’s initial acquisition date forward.

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TABLE IV

OPERATING RESULTS OF COMPLETED PRIOR PROGRAMS

(UNAUDITED)

Table IV presents information regarding the operating results of the last five prior real estate programs that have completed operations (no longer hold properties) during the five years ended December 31, 2018. All amounts presented are as of December 31, 2018.

	Arbors at Fairview			Midtown Crossing			Oak Ridge			Regatta			Waterford Creek
Aggregate Dollar Amount Raised	$	6,800,960		$	6,435,000		$	8,500,000		$	13,375,000		$	4,932,430
Duration of Program (Months)		22			58			121			118			78
Date of Program Closing		9/28/2018			9/28/2018			3/29/2018			1/2/2018			9/28/2018
Total Compensation Paid to Sponsor (1)	$	888,306		$	780,458		$	2,699,777		$	2,444,655		$	968,416
Median Leverage		67	%		47	%		80	%		76	%		78	%
Annualized Return on Investment(2)		51.7	%		23.6	%		9.6	%		9.0	%		32.7	%
Start Date		11/15/2016			11/11/2013			2/28/2008			2/11/2008			3/23/2012
End Date		9/28/2018			9/28/2018			3/29/2018			1/2/2018			9/28/2018
Median Month		Oct-17			Apr-16			Mar-13			Jan-13			Jun-15

⁽¹ Includes acquisition fees, property and asset management fees, disposition fees, financing fees, and other ancillary services. A portion of these fees are used to reimburse costs incurred by the Sponsor.

⁽²⁾ Annualized return on investment is the internal rate of return over the program period using the respective cash flows from invested capital, distributions received, and proceeds from sale.

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We have not authorized any dealer, salesperson or other individual to give any information or to make any representations that are not contained in this prospectus. If any such information or statements are given or made, you should not rely upon such information or representation. This prospectus does not constitute an offer to sell any securities other than those to which this prospectus relates, or an offer to sell, or a solicitation of an offer to buy, to any person in any jurisdiction where such an offer or solicitation would be unlawful. This prospectus speaks as of the date set forth below. You should not assume that the delivery of this prospectus or that any sale made pursuant to this prospectus implies that the information contained in this prospectus will remain fully accurate as of any time subsequent to the date of this prospectus.

TABLE OF CONTENTS

	Page
Suitability Standards		1
Prospectus Summary		3
Risk Factors		20
Cautionary Note Regarding Forward Looking Statements		46
Plan of Distribution		47
Estimated Use of Proceeds		52
Management		54
Management Compensation		63
Stock Ownership		67
Conflicts of Interest		68
Investment Objectives and Criteria		75
Prior Performance Summary		90
Federal Income Tax Considerations		94
ERISA Considerations		113
Description of Shares		118
The Operating Partnership Agreement		133
Supplemental Sales Material		135
Legal Matters		135
Where You Can Find More Information		135
Appendix A — Form of Subscription Agreement		A-1
Appendix B — Amended and Restated Distribution Reinvestment Plan		B-1
Appendix C — Prior Performance Tables		C-1

Our shares are not FDIC insured, may lose value and are not bank guaranteed. See “Risk Factors” beginning on page 20, to read about risks you should consider before buying shares of our common stock.

Maximum Offering of

$750,000,000 of

Common Stock

PROSPECTUS

ORCHARD SECURITIES, LLC

COTTONWOOD COMMUNITIES, INC.

SUPPLEMENT NO. 7 DATED APRIL 17, 2020

TO THE PROSPECTUS DATED OCTOBER 15, 2019

This document supplements, and should be read in conjunction with, the prospectus of Cottonwood Communities, Inc. dated October 15, 2019. This supplement no. 7 supersedes and replaces all prior supplements to the October 15, 2019 prospectus. As used herein, the terms “we,” “our” and “us” refer to Cottonwood Communities, Inc. and, as required by context, Cottonwood Communities O.P., LP, which we refer to as our “Operating Partnership,” and to their subsidiaries. Capitalized terms used in this supplement have the same meanings as set forth in the prospectus. The purpose of this supplement is to disclose:

• the status of the offering;

• updated risks related to an investment in us;

• information regarding distributions;

• information regarding our real estate investments;

• information regarding our outstanding debt obligations;

• compensation to our advisor and its affiliates;

• information regarding the net tangible book value of our shares;

• information regarding our share repurchase program;

• updates to our plan of distribution;

• information about equity incentive awards granted to our executive officers;

• our “Prior Performance Summary” as of December 31, 2019;

• information regarding a class of our preferred stock and related private offering;

• information about our amended and restated limited partnership agreement;

• experts information;

• information incorporated by reference; and

• our “Prior Performance Tables” as of December 31, 2019.

Status of the Offering

We commenced this offering of $750.0 million of shares of common stock on August 13, 2018. As of April 10, 2020, we had sold 10,231,726 shares of our Class A common stock and 17,501 shares of our Class T common stock in this offering for aggregate gross offering proceeds of $101,967,412. Included in these amounts were 72,963 shares of common stock sold pursuant to our distribution reinvestment plan for aggregate gross offering proceeds of $729,627. Accordingly, as of April 10, 2020, there was approximately $648,032,588 of shares available for sale in this offering.

Risk Factors

The following risk factors supplement, or supersede and replace as appropriate, the risk factors appearing in the prospectus.

The outbreak of widespread contagious disease, such as the novel coronavirus, COVID-19, could adversely impact our operations and the value of our investments.

The recent outbreak of the COVID-19 virus that has rapidly spread to a growing number of countries, including the United States, has created considerable instability and disruption in the U.S. and world economies. The extent to which our results of operations or our overall value will be affected by the COVID-19 virus will largely depend on future developments, which are highly uncertain and cannot be accurately predicted, including new information which may emerge concerning the severity of the COVID-19 virus and the actions required to be undertaken to contain the COVID-19 virus or treat its impact. Given the uncertainty, no assurance can be given that the value of our investments made prior to March 2020 has not declined below the purchase price of the investment. As a result of shutdowns, quarantines or actual viral health issues, tenants at our multifamily apartment communities

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may experience reduced wages for a prolonged period of time and may be unable to make their rental payments. In the last month, we have experienced a limited number of requests for rent deferrals. We may be unable to evict tenants due to federal, state and/or local laws or regulations or lender requirements implemented as a result of the COVID-19 virus outbreak. In addition, property managers may be limited in their ability to properly maintain our multifamily apartment communities. Market fluctuations may affect our ability to obtain necessary funds for our operations from current lenders or new borrowings. In addition, we may be unable to obtain financing for the acquisition of investments on satisfactory terms, or at all. The occurrence of any of the foregoing events or any other related matters could materially and adversely affect our financial performance and our overall value, and investors could lose all or a substantial portion of their investment in us.

The offering price of our shares was not established in reliance on a valuation of our assets and liabilities; the actual value of your investment may be substantially less than what you pay.

We established the offering price of our shares on an arbitrary basis. The selling price of our shares bears no relationship to our book or asset values or to any other established criteria for valuing shares. The actual value of an investment in us may be less than the offering price. In particular, and as discussed in the risk factor above, we do not know the extent to which our results of operations or overall value will be affected by the COVID-19 virus and no assurance can be given that the actual value of an investment in us is not substantially less than the current offering price.

We plan to determine the net asset value of our common stock no later than May 17, 2021, and annually thereafter. Our net asset value will be determined based on valuations of our assets and liabilities by, or with the material assistance or confirmation of, a third-party valuation expert or service. The method used in any year will be selected by our board of directors.

To assist FINRA members and their associated persons that participate in this offering, we intend to disclose in each annual report distributed to shareholders a per share estimated value of our shares developed in a manner reasonably designed to ensure it is reliable, the method by which it was developed and the date of the estimated valuation.

The actual value of shares that we repurchase under our share repurchase program may be substantially less than what we pay.

Under our share purchase program, shares may be repurchased at varying prices depending on (a) the number of years the shares have been held, (b) the purchase price paid for the shares, and (c) whether the redemptions are sought upon a shareholder’s death, or “complete disability” (as defined in the share repurchase program). The maximum price that may be paid under the program is $9.50 per share, which is 95% of the offering price of our shares of common stock in the primary portion of this offering (ignoring purchase price discounts for certain categories of purchasers). Although this purchase price represents a discount to the price at which most investors were willing to purchase shares in this offering, this value may differ from the price at which a shareholder could resell his or her shares for the reasons discussed in the risk factor above. Thus, when we repurchase shares of our common stock at $9.50 per share, the actual value of the shares that we repurchase may be less, and the repurchase may be dilutive to our remaining shareholders. Even at lower repurchase prices, the actual value of the shares may be less than what we pay and the repurchase may be dilutive to our remaining shareholders.

Because the current offering price for our shares of common stock in this offering exceeds the net tangible book value per share, investors in this offering will experience immediate dilution in the net tangible book value of their shares.

We are offering, on a best efforts basis, up to a maximum of $750,000,000 in shares of our common stock in this primary offering, consisting of two classes of shares: Class A shares and Class T shares at a purchase price of $10.00 per share. Our current public offering price for our shares exceed our net tangible book value per share. Our net tangible book value per share is calculated as total book value of assets minus total book value of liabilities, divided by the total number of shares of common stock outstanding. Net tangible book value is used generally as a conservative measure of net worth that we do not believe reflects our estimated value per share. It is not intended to reflect the value of our assets upon an orderly liquidation of the company in accordance with our investment

S-2

objectives. However, net tangible book value does reflect certain dilution in value of our common stock from the issue price in this offering primarily as a result of (i) the fees and expenses paid to our advisor and its affiliates in connection with the management of our investments, (ii) general and administrative expenses, and (iii) accumulated depreciation and amortization of real estate investments.

As of December 31, 2019, our net tangible book value per share of our common stock was $9.30. To the extent we are able to raise substantial proceeds in this offering, some of the expenses that cause dilution of the net tangible book value per share are expected to decrease on a per share basis, resulting in increases in the net tangible book value per share. This increase would be partially offset by increases in depreciation and amortization expenses related to our real estate investments.

If our investments and future investments fail to perform as expected, cash distributions to our shareholders may decline.

As of the date of this supplement, we owned two multifamily apartment communities; have issued a B Note secured by a deed of trust on a multifamily development project in Allen, Texas; have made a preferred equity investment in a multifamily development project in Ybor City, Florida; and have entered into an agreement to provide a preferred equity investment for a multifamily development project in Denver, Colorado. Each of these investments was based on an underwriting analysis with respect to each investment. If these investments do not perform as expected, whether as a result of the impact of the COVID-19 virus on U.S. and world economies, or otherwise, or future acquisitions do not perform as expected, we may have less cash flow from operations available to fund distributions and investor returns may be reduced.

We have paid distributions from offering proceeds. In the future we may continue to fund distributions with offering proceeds. To the extent we fund distributions from sources other than our cash flow from operations, we will have less funds available for investment in multifamily apartment communities and multifamily real estate-related assets and the overall return to our shareholders may be reduced.

Our charter permits us to make distributions from any source, including offering proceeds or borrowings (which may constitute a return of capital), and our charter does not limit the amount of funds we may use from any source to pay such distributions. We intend to make distributions on our common stock on a per share basis with each share receiving the same distribution. If we fund distributions from financings, the proceeds from this or future offerings or other sources, we will have less funds available for investment in multifamily apartment communities and other multifamily real estate-related assets and the number of real estate properties that we invest in and the overall return to our shareholders may be reduced. If we fund distributions from borrowings, our interest expense and other financing costs, as well as the repayment of such borrowings, will reduce our earnings and cash flow from operations available for distribution in future periods. If we fund distributions from the sale of assets or the maturity, payoff or settlement of multifamily real estate-related assets, this will affect our ability to generate cash flows from operations in future periods.

We expect to have little, if any, cash flow from operations available for distribution until we make substantial investments. During the early stages of our operations, it is likely that we will use sources of funds which may constitute a return of capital to fund distributions. During this offering stage, when we may raise capital more quickly than we acquire income-producing assets, and for some period after this offering stage, we may not be able to make distributions solely from our cash flow from operations. Further, because we may receive income from our investments at various times during our fiscal year and because we may need cash flow from operations during a particular period to fund capital expenditures and other expenses, we expect that at least during the early stages of our existence and from time to time during our operational stage, we will declare distributions in anticipation of cash flow that we expect to receive during a later period and we will make these distributions in advance of our actual receipt of these funds. In addition, to the extent our investments are in development or redevelopment projects or in properties that have significant capital requirements, our ability to make distributions may be negatively impacted, especially during our early periods of operation. In these instances, we expect to look to third party borrowings to fund our distributions. We may also fund such distributions from the sale of assets. To the extent that we pay distributions from sources other than our cash flow from operating activities, we will have less funds available for the acquisition of real estate investments, the overall return to our shareholders may be reduced and subsequent investors will experience dilution. In addition, to the extent distributions exceed cash flow from operating activities, a shareholder’s basis in our stock will be reduced and, to the extent distributions exceed a shareholder’s basis, the shareholder may recognize capital gain.

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For the year ended December 31, 2019, we made aggregate distributions of $2,004,075, including $1,602,472 distributions paid in cash and $401,603 of distributions reinvested through our distribution reinvestment plan. Our net loss for the year ended December 31, 2019 was $3,296,194. Cash flows used in operating activities for the year ended December 31, 2019 was $459,142. We funded our total distributions paid, which includes net cash distributions and distributions reinvested by shareholders, with $384,310 prior period cash provided by operating activities and $1,619,765 of offering proceeds. Generally, for purposes of determining the source of our distributions paid, we assume first that we use cash flow from operating activities from the relevant or prior periods to fund distribution payments.

Our advisor has agreed to pay all offering-related expenses in this offering on our behalf, and if it is unable or determines not to do so in the future, your investment in us may be diluted and your returns would be lower than they otherwise would be.

Our advisor has agreed to pay all offering-related expenses in this offering. If our advisor is unable or determines not to pay all or a portion of these expenses in the future, then we may have to revise the terms of the offering to provide that we would pay all or a portion of the offering-related expenses in connection with the sale of shares in this offering. We may choose to increase the respective offering prices of our shares of common stock to account for these offering-expenses and mitigate the dilutive impact to our existing shareholders; however, we are not required to do so. Our payment of such offering expenses without a related increase in the offering price of shares in this offering would reduce our net offering proceeds from the sale of shares, which would dilute our existing shareholders and reduce our returns and the value of your investment.

We may be adversely affected by changes to the LIBOR settling process and potential phasing out of LIBOR after 2021.

Certain of our outstanding debt as well as our investment in the Dolce B Note is indexed to the London Interbank Offered Rate (“LIBOR”). LIBOR and certain other interest “benchmarks” may be subject to regulatory guidance and/or reform that could cause interest rates under our current or future debt agreements and investments to perform differently than in the past or cause other unanticipated consequences. The United Kingdom’s Financial Conduct Authority, which regulates LIBOR, has announced that it intends to stop encouraging or requiring banks to submit rates for the calculation of LIBOR rates after 2021, and it is unclear whether new methods of calculating LIBOR will be established, such that LIBOR may continue to exist after 2021. While there is no consensus on what rate or rates may become accepted alternatives to LIBOR, the Alternative Reference Rates Committee, a steering committee comprised of U.S. financial market participants, selected the Secured Overnight Finance Rate (“SOFR”) as an alternative to LIBOR. SOFR is a broad measure of the cost of borrowing cash in the overnight U.S. treasury repo market, and the Federal Reserve Bank of New York started to publish the SOFR in May 2018. At this time, it is impossible to predict whether the SOFR or another reference rate will become an accepted alternative to LIBOR. The discontinuation, reform or replacement of LIBOR or any other benchmark rates may have an unpredictable impact on contractual mechanics in the credit markets or cause disruption to the broader financial markets, and could have an adverse effect on LIBOR-based interest rates on our current or future debt obligations and derivatives.

We could be negatively impacted by the condition of Fannie Mae or Freddie Mac and by changes in government support for multifamily housing.

Fannie Mae and Freddie Mac are a major source of financing for multifamily real estate in the United States. We have utilized and expect to continue to utilize loan programs sponsored by these entities as a key source of capital to finance our growth and our operations. In September 2008, the U.S. government increased its control of Fannie Mae and Freddie Mac and placed both companies into a government conservatorship under the Federal Housing Finance Agency (the “FHFA”). Since that time, members of Congress have introduced and Congressional committees have considered a substantial number of bills that include comprehensive or incremental approaches to winding down Fannie Mae and Freddie Mac or changing their purposes, businesses or operations. In 2019, the FHFA for the first time released formal objectives calling for the return of Fannie Mae and Freddie Mac to the private sector. It was also announced during the year that Fannie Mae and Freddie Mac will be permitted to retain a combined $45 billion worth of earnings (Fannie Mae will be allowed to retain $25 billion and Freddie Mac $20

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billion). This is a modification of the so-called “net worth sweep” provision that has required Fannie Mae and Freddie Mac to deliver nearly all of their profits to the Treasury; the result being that each organization will have the opportunity to build its net worth. A decision by the U.S. government to eliminate or downscale Fannie Mae or Freddie Mac or to reduce government support for multifamily housing more generally may adversely affect interest rates, capital availability, development of multifamily communities and the value of multifamily assets and, as a result, may adversely affect our operations. Any potential reduction in loans, guarantees and credit enhancement arrangements from Fannie Mae and Freddie Mac could jeopardize the effectiveness of the multifamily sector’s derivative securities market, potentially causing breaches in loan covenants, and through reduced loan availability, impact the value of multifamily assets, which could impair the value of a significant portion of multifamily communities. Specifically, the potential for a decrease in liquidity made available to the multifamily sector by Fannie Mae and Freddie Mac could (i) hinder our ability to obtain new financing or refinance our existing loans; (ii) require us to obtain other sources of debt capital with potentially different terms; and (iii) make it more difficult for potential buyers of our properties to obtain financing.

Holders of our preferred stock will have dividend, liquidation and other rights that are senior to the rights of the holders of our common stock.

Our board of directors has the authority to designate and issue preferred stock with liquidation, dividend and other rights that are senior to those of our common stock. On November 8, 2019, we classified and designated 5,000,000 shares of our authorized but unissued preferred stock as shares of non-voting Series 2019 preferred stock which we are offering for sale through a best-efforts private placement offering of up to $50,000,000 to accredited investors only. The outstanding Series 2019 preferred stock is entitled to receive a preferred dividend equal to a 5.5% (subject to an increase to 6.0% in certain circumstances) per annum cumulative but not compounded return on invested capital on the purchase price of $10.00.

Holders of our Series 2019 preferred stock are entitled to cumulative dividends before any dividends may be declared or set aside on our common stock, or the redemption of our common stock. Upon our voluntary or involuntary liquidation, dissolution or winding up, before any payment is made to holders of our common stock, holders of the preferred stock are entitled to receive a liquidation preference of $10.00 per share plus any accrued and unpaid distributions. This will reduce the remaining amount of our assets, if any, available to distribute to holders of our common stock. Because the offering of the Series 2019 preferred stock is being made without a firm commitment for any purchase of the preferred stock, we can provide no assurances as to how many, if any, shares of preferred stock we will issue. As of April 10, 2020, we had sold 965,894 shares of Series 2019 preferred stock for aggregate gross offering proceeds of $9,621,279.

Distribution Information

Common Stock

Distributions as of December 31, 2019

Distributions attributable to our common stock that were declared and paid and cash provided by (used in) operating activities were as follows for the year ended December 31, 2019.

					Distributions Paid(3)
Period	Distributions Declared (1)		Distributions Declared Per Share (1)(2)		Cash		Reinvested (DRP)		Total		Cash Provided By (Used In) Operating Activities
First Quarter	$	117,486		0.06216279	$	40,024	$	18,021	$	58,045	$	(19,449	)
Second Quarter		477,731		0.09442300		271,447		69,565		341,012		384,310
Third Quarter		767,563		0.10825698		562,887		124,224		687,111		(172,410	)
Fourth Quarter		1,006,812		0.11374146		728,114		189,793		917,907		(651,593	)
Total	$	2,369,592			$	1,602,472	$	401,603	$	2,004,075	$	(459,142	)

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⁽¹⁾  Distributions for the periods from January 1, 2019 through February 28, 2019 and March 19, 2019 through December 31, 2019 were based on daily record dates and were calculated at a rate of $0.00136986 per share per day. A daily distribution in the amount of $0.02465753 per share was declared for shareholders of record as of March 18, 2019.

⁽²⁾  Assumes share was issued and outstanding each day during the period presented.

⁽³⁾  Distributions are paid on a monthly basis. In general, distributions for all record dates of a given month are paid on or about the fifth business day of the following month.

For the year ended December 31, 2019, we made aggregate distributions of $2,004,075, including $1,602,472 distributions paid in cash and $401,603 of distributions reinvested through our distribution reinvestment plan. Our net loss for the year ended December 31, 2019 was $3,296,194. Cash flows used in operating activities for the year ended December 31, 2019 was $459,142. We funded our total distributions paid, which includes net cash distributions and distributions reinvested by shareholders, with $384,310 prior period cash provided by operating activities and $1,619,765 of offering proceeds. Generally, for purposes of determining the source of our distributions paid, we assume first that we use cash flow from operating activities from the relevant or prior periods to fund distribution payments.

From July 27, 2016 (inception) through December 31, 2019, we paid cumulative distributions of $2,004,075 and our cumulative net loss during the same period was $3,396,403. To the extent that we pay distributions from sources other than our cash flow from operating activities, we will have less funds available for the acquisition of real estate investments, the overall return to our shareholders may be reduced and subsequent investors will experience dilution. In addition, to the extent distributions exceed cash flow from operating activities, a shareholder’s basis in our stock will be reduced and, to the extent distributions exceed a shareholder’s basis, the shareholder may recognize capital gain.

Distributions Declared and Paid Subsequent to December 31, 2019

On January 10, 2020, we paid distributions of $365,517, which related to distributions declared for daily record dates for each day in the period from December 1, 2019 through December 31, 2019. On February 10, 2020, we paid distributions of $382,935, which related to distributions declared for daily record dates for each day in the period from January 1, 2020 through January 31, 2020. On March 9, 2020, we paid distributions of $375,939, which related to distributions declared for daily record dates for each day in the period from February 1, 2020 through February 29, 2020. On April 9, 2020, we paid distributions of $442,420, which related to distributions declared for daily record dates for each day in the period from March 1, 2020 through March 31, 2020.

Our board of directors has declared cash distributions on the outstanding shares of our common stock based on daily record dates for the period from April 1, 2020 through April 30, 2020, which we expect to pay in May 2020; and the period from May 1, 2020 through May 31, 2020, which we expect to pay in June 2020. Common shareholders may choose to receive cash distributions or purchase additional shares through our distribution reinvestment plan. Distributions will be calculated based on common shareholders of record each day during these periods at a rate of $0.00136612 per share per day. Distributions declared at this daily rate equal an annualized rate of 5.0% based on a $10.00 purchase price per share and assuming distributions are paid every day for a year at the current daily distribution rate.

Preferred Stock

Dividends Declared and Paid Subsequent to December 31, 2019

Pursuant to the terms of our Series 2019 preferred stock, we have paid aggregate dividends of $62,513 to holders of our preferred stock based on daily record dates from December 1, 2019 through March 31, 2020. In addition, our board of directors has declared distributions on the outstanding shares of our preferred stock based on daily record dates for the period from April 1, 2020 through April 30, 2020, which we expect to pay in May 2020; and the period from May 1, 2020 through May 31, 2020, which we expect to pay in June 2020. Distributions will be calculated based on holders of our preferred stock of record each day during these periods at a rate of $0.00150273 per share per day.

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Real Estate Investments

Multifamily Apartment Communities

As of the date of this supplement, we owned two multifamily properties. We acquired each of these properties from third parties unaffiliated with us or our advisor. We believe that our properties are suitable for their intended purpose and adequately insured. We do not intend to make any renovations to our properties in the near term. The following table provides summary information regarding our multifamily properties as of March 31, 2020:

Property     Location of Property	Date Acquired		Number of Units		Purchase Price (in thousands) (1)		Monthly Rent (2)		Occupancy (3)			Effective Monthly Rent per Unit (4)		Rentable Square Feet
Cottonwood West Palm West Palm Beach, FL		5/30/2019		245	$	67,000	$	394,087		93.06	%	$	1,728		274,889
One Upland Greater Boston Area, MA		3/19/2020		262	$	103,600	$	564,998		90.46	%	$	2,384		303,840

⁽¹⁾ Purchase price excludes acquisition fees and closing costs.

⁽²⁾  Monthly rent is based on the aggregate contractual rent from tenant leases in effect as of March 31, 2020, adjusted to reflect any contractual tenant concessions.

⁽³⁾  Occupancy percentage is calculated as the number of occupied units divided by the total number of units of the property as of March 31, 2020.

⁽⁴⁾  Effective monthly rent per unit is calculated as the monthly contractual base rent, net of free rent, divided by the units leased, all as of March 31, 2020.

Multifamily Real Estate-Related Assets

As of the date of this supplement, we have issued a B Note secured by a deed of trust on a multifamily development project in Allen, Texas; have made a preferred equity investment in a multifamily development project in Ybor City, Florida; and have entered into an agreement to provide a preferred equity investment for a multifamily development project in Denver, Colorado. Additional information is provided below.

Dolce B Note

On July 31, 2019, we, through our operating partnership, invested in a B note secured by a deed of trust on a development project for an amount of up to $10 million (which commitment could rise to $10.5 million in certain circumstances) (the “Dolce B Note”). The borrower under the Dolce B Note is Dolce Twin Creeks Phase 2, LLC, a Delaware limited liability company, an unaffiliated third party. The borrower intends to use the proceeds from the Dolce B Note, additional financing in the amount of $45.5 million (the “Dolce A Note”) and $17.9 million in common equity for the development of Dolce Twin Creeks, Phase II, a proposed 366-unit multifamily project and approximately 15,000 square feet of medical office space on a 10.89 acre site located in Allen, Texas, a northern suburb of Dallas (the “Project”). We funded the Dolce B Note with proceeds from this offering.

The Dolce B Note bears interest at a rate of 9.50% plus 1-month LIBOR and is expected to be drawn upon in stages as needed throughout the construction of the Project. As of December 31, 2019, $1,794,000 had been drawn. The loan includes a 1-month LIBOR floor equal to 2.50%, resulting in an interest rate floor equal to 12.00% for the Dolce B Note. The maturity date of the Dolce B Note is December 31, 2021 with two six-month extension options. Prior to maturity, the borrower under the Dolce B Note is required to make monthly interest only payments with principal due at maturity. Prepayment of the Dolce B Note is permitted in whole but not in part subject to certain prepayment fees. The borrower may obtain a release of the parcel that will contain the medical office space for a minimum release price of $3,960,000 (82.5% of the as-stabilized appraised value of that parcel), which would be applied pro rata, without prepayment fees, to repayment of the A Note and the B Note.

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The Dolce A Note has the same maturity date as the Dolce B Note. We entered into a co-lender agreement with the holder of the Dolce A Note that outlines the rights and remedies of the parties with respect to the notes. The holder of the Dolce A Note has certain administrative and decision-making rights, as the master servicer of the loan, subject to our consent for certain major decisions related to the loan. In addition, under the co-lender agreement, in the event the mortgage loan becomes non-performing and provided the Dolce B Note position retains a predetermined value in the mortgage loan we will have control over the remedies relating to the enforcement of the mortgage loan subject to certain consent rights of the other note holders.

The Project is sponsored by Sovereign Properties, an experienced developer of multifamily properties. An affiliate of Sovereign Properties completed and stabilized the adjacent 374-unit Dolce Twin Creeks Phase I project. Early construction has commenced on the Project and completion is anticipated in January 2021.

Lector85 Investment

On August 15, 2019, we, through a wholly owned subsidiary, made a preferred equity investment of up to $9,900,000 in an entity that is developing a multifamily community in Ybor City, Florida (the “Lector85 Investment”). In connection with our investment we entered a joint venture agreement with an affiliate of Milhaus, LLC (“Milhaus”), the sponsor of the development.

Pursuant to the terms of the joint venture agreement, the Lector85 Investment has an annual preferred return of 13% that will be reduced to 10% annually upon the later to occur of (i) the stabilization of the development project, and (ii) the one-year anniversary of the development project receiving a temporary certificate of occupancy for the last unit(s) completed, subject to certain financial covenants being satisfied. The investment has a special preferred return of $200,000 to be paid upon redemption. Subject to one twelve-month extension option, the redemption date of the Lector85 Investment is no earlier than two years after the date on which the project receives a temporary certificate of occupancy with respect to the last unit(s) delivered at the project (the “Redemption Lockout Date”) but no later than the earlier of (i) the payment in full of the construction loan related to the project, if the loan is repaid after the Redemption Lockout Date, or (ii) the construction loan maturity date, if the construction loan is not refinanced prior to the Redemption Lockout Date.

Milhaus intends to use the loan, along with a $34.0 million construction loan and equity of $9.3 million to fund total development costs of $53.3 million for a 4-story, 254-unit urban-style apartment community that will include over 11,000 square feet of retail. The Lector85 Investment is expected to be drawn upon in stages as needed throughout the construction of the project. As of December 31, 2019, $4,689,000 had been drawn.

2980 Huron Preferred Equity Investment

On October 25, 2019, we, through a wholly owned subsidiary, entered a limited liability company agreement (the “Huron Joint Venture Agreement”) with respect to a preferred equity investment (the “2980 Huron Investment”) in an entity (the “2980 Huron Owner”) that has purchased and intends to develop a parcel of land commonly known as 2980 Huron Street in Denver, Colorado (the “2980 Huron Project”) as described below.

We, through our wholly owned subsidiary, and an affiliate of CA Residential, a real estate investment and development firm, (the “Huron Developer”) are the sole members of the joint venture that is the sole member and owner of the 2980 Huron Owner. The Huron Developer is the managing member of the 2980 Huron Owner; however, we have approval rights with respect to major decisions involving the 2980 Huron Project. We expect the Huron Developer or its affiliates to provide services to the 2980 Huron Project for which they will earn fees separate and in addition to any payments associated with their equity interest.

Pursuant to the Joint Venture Agreement we will contribute up to $20.0 million for our preferred membership interest in the 2980 Huron Owner with additional funding for the 2980 Huron Project to come from a $17.5 million common equity contribution from the Huron Developer and a $65.4 million secured construction loan (the “Huron Secured Loan”), with total development costs estimated at $102.9 million. Our contributions to the 2980 Huron Owner will only be made following the contribution of the full $17.5 million of equity from the Huron Developer and then will be made as project costs are incurred.

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Pursuant to the terms of the Joint Venture Agreement, the 2980 Huron Investment has a preferred return of 12% annually, compounded monthly, and matures on the earlier of: (i) the sale of the 2980 Huron Project (ii) the maturity of the Huron Secured Loan; and (iii) such earlier date as may be provided in the transaction documents, all subject to a one-year extension provided certain conditions are satisfied. In addition, we will receive an underwriting fee in the amount of 1% of our preferred equity investment at origination and will receive an exit fee in the amount of 0.5% of the investment amount on repayment.

The 2980 Huron Project is a proposed 13-story, 299-unit high-rise multifamily apartment community located on 0.84 acres in the Union Station North neighborhood in downtown Denver, Colorado. Upon completion, the 2980 Huron Project is expected to feature several amenities, including a pool deck, fitness center, aqua lounge and a co-working space and lounge. We expect construction on the 2980 Huron Project to commence in the first quarter of 2020 and to be completed in 2022.

Pursuant to the Joint Venture Agreement our obligation to advance the funds for our preferred equity membership interest is subject to the satisfaction of certain conditions, including but not limited to the closing of the Huron Secured Loan with terms and conditions as approved by us; the execution of certain construction documents with the selection of a general contractor for the Huron Project as reasonably approved by us; approval of a site plan for the Huron Project as approved by us, the lender for the Huron Secured Loan and the City and County of Denver, Colorado; the delivery of certain documentation to us by the Huron Developer and other parties related to the Huron Project. We can provide no assurance that these conditions will be met and that we will ultimately advance funds for the 2980 Huron Investment.

Outstanding Debt Obligations

As of the date of this supplement, we are parties to two credit facilities. The following table provides additional information regarding these credit facilities as of March 31, 2020.

	Outstanding Principal Balance	Contractual Interest Rate(1)	Effective Interest Rate(1)	Payment Type	Maturity Date	% of Total Indebtedness	Security
Berkadia Credit Facility	$35,995,000(2)	3.93%	3.93%	Interest only	May 30, 2029(3)	41.86%	Cottonwood West Palm(4)
JP Morgan Credit Facility	$50,000,000(5)	One-month LIBOR+1.5%(6)	2.49%	Interest only	March 19, 2023(3)(7)	58.14%	One Upland(4)

⁽¹⁾  Contractual interest rate represents the interest rate in effect under the loan as of March 31, 2020. Effective interest rate is calculated as the actual interest rate in effect at March 31, 2020 (consisting of the contractual interest rate), using interest rate indices at March 31, 2020, where applicable.

⁽²⁾  The aggregate loan-to-value ratio for all advances made with respect to the Berkadia Credit Facility cannot exceed 65% at the time any advance is made. There is no limit on the amount that we can borrow under the Berkadia Credit Facility so long as we maintain the loan-to-value ratio and other requirements set forth in the loan documents.

⁽³⁾ We have the right to prepay all or a portion of the facility at any time subject to certain fees and conditions.

⁽⁴⁾ Any advance under the respective facility will be cross-collateralized with the other advances under the respective facility. We may sell the multifamily apartment communities that are secured by the facility individually provided that certain loan-to-value and debt coverage ratios and other requirements are met as set forth in the respective loan documents.

⁽⁵⁾ We may obtain advances secured against One Upland up to the amount of $67,600,000, subject to certain debt service coverage ratio requirements. The aggregate loan-to-value ratio for all advances made with respect to the JP Morgan Credit Facility cannot exceed 65% at the time any advance is made. We may borrow up to $125,000,000 under the facility; however, we must maintain the loan-to-value ratio and debt coverage ratios and other requirements set forth in the loan documents.

⁽⁶⁾ The spread can range from 1.50% to 1.75%, depending on certain debt yield metrics set forth in the loan agreement and as evidenced by a promissory note.

⁽⁷⁾  The facility has the option to extend for two one-year periods subject to the satisfaction of certain conditions set forth in the loan agreement.

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Compensation to our Advisor and its Affiliates

Summarized below are the fees earned by and expenses reimbursable to our advisor and its affiliates for the year ended December 31, 2019.

	Incurred in the		Payable as of
Types of Compensation	Year Ended December 31, 2019		December 31, 2019
Asset Management Fees(1)	$	811,395	$	106,075
Property Management Fees		97,877		16,174
Operating Expense Reimbursements		541,652	$	142,261
Total	$	1,450,924	$	264,510

⁽¹⁾  Our advisor has agreed to waive its asset management fee each month in an amount equivalent to the 6.0% discount provided to those who purchase Class A shares through certain distribution channels as specified in the prospectus. This is to ensure that we receive proceeds equivalent to those received for sales of shares outside of these channels. As a result, the asset management fee waived by our advisor for the year ended December 31, 2019 was $409,803.

Net Tangible Book Value Per Share

In connection with this offering of shares of our common stock, we are providing information about our net tangible book value per share. Our net tangible book value per share is calculated as total book value of assets minus total book value of liabilities, divided by the total number of shares of common stock outstanding. Net tangible book value is used generally as a conservative measure of net worth that we do not believe reflects our estimated value per share. It is not intended to reflect the value of our assets upon an orderly liquidation of the company in accordance with our investment objectives. However, net tangible book value does reflect certain dilution in value of our common stock from the issue prices in this offering primarily a result of (i) the fees and expenses paid to our advisor and its affiliates in connection with the management of our investments, (ii) general and administrative expenses, and (iii) accumulated depreciation and amortization of real estate investments.

As of December 31, 2019, our net tangible book value per share of common stock was $9.30. The offering price for shares of our common stock under this primary offering (ignoring purchase price discounts for certain categories of purchasers) is $10.00 per share. To the extent we are able to raise substantial proceeds in this offering, some of the expenses that cause dilution of the net tangible book value per share are expected to decrease on a per share basis, resulting in increases in the net tangible book value per share. This increase would be partially offset by increases in depreciation and amortization expenses related to our acquisition of real estate investments.

Share Repurchase Program

During the year ended December 31, 2019, we did not repurchase any shares of our common stock as no shares were submitted for repurchase. During any calendar year, we may repurchase only the number of shares that we could purchase with the amount of net proceeds from the sale of shares under our distribution reinvestment plan during the prior calendar year. For the year ended December 31, 2019, we raised $401,603 proceeds in our distribution reinvestment plan, all of which is available to fund eligible redemptions for the 2020 calendar year. Our board of directors may, in its sole discretion, amend, suspend or terminate our share repurchase program for any reason upon 15 days’ notice to our shareholders.

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Plan of Distribution

General

Our advisor is responsible for paying all organization and offering expenses in this offering without reimbursement by us with the exception of the underwriting expense associated with the grant of LTIP Units by the Operating Partnership to certain registered persons associated with the dealer manager.

The following discussion regarding “Compensation of Dealer Manager and Soliciting Dealers” that appears in the “Plan of Distribution” of the prospectus supersedes and replaces the corresponding discussion in the prospectus.

Compensation of Dealer Manager and Soliciting Dealers

Upfront Selling Commissions and Dealer Manager Fees

Our advisor pays the dealer manager selling commissions of up to 6% and up to 3% of the gross primary offering proceeds from the sale of our Class A and Class T common stock, respectively. The dealer manager may authorize certain other broker-dealers who are members of FINRA, who we refer to as soliciting dealers, to sell our shares. In the event of the sale of shares by soliciting dealers, the dealer manager re-allows all of its selling commissions to the soliciting dealers.

For both classes of shares, our advisor also pays the dealer manager a dealer manager fee up to 3% of the gross primary offering proceeds as compensation for acting as the dealer manager and for expenses incurred in connection with marketing our shares and wholesaler compensation. Of this dealer manager fee, Orchard Securities, LLC pays up to 1.35% of the gross proceeds from the primary offering to certain wholesalers that may be employees of Cottonwood Residential II, Inc. or Cottonwood Residential O.P., LP. In addition, from this dealer manager fee, Orchard Securities, LLC re-allows 1.00% of the gross proceeds from the primary offering to soliciting dealers as a non-accountable marketing and due diligence allowance, and in select cases up to 1.25% of the gross proceeds from the primary offering will be reallowed. In circumstances where 1.00% of offering proceeds are reallowed, the dealer manager fee will be 2.75%. The maximum amount of reimbursements would be based on factors such as the number of shares sold by soliciting dealers, the assistance of such soliciting dealers in marketing the offering, and due diligence expenses incurred.

Deferred Selling Commissions

Subject to FINRA limitations on underwriting compensation and certain other limitations described below, our advisor pays the dealer manager a deferred selling commission with respect to our outstanding Class T shares sold in the primary offering equal to 1.0% per annum of the estimated value per share for the Class T share for three years from the date on which such share is issued.

The deferred selling commission will accrue daily based on the number of Class T shares outstanding on each day that were sold in the primary offering within the previous three years of such date and be paid monthly in arrears. The dealer manager will reallow all of the deferred selling commissions to soliciting dealers and servicing broker-dealers as described below. Class T shares purchased pursuant to our distribution reinvestment plan or received as a stock dividend are not subject to a deferred selling commission. Because our advisor has agreed to pay the deferred selling commissions and other underwriting compensation on our behalf without reimbursement by us, the deferred selling commission will have no impact on us or on holders of our Class T shares.

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Eligibility to receive the deferred selling commission with respect to any Class T share is conditioned on a broker-dealer acting as the broker-dealer of record or acting as a servicing broker-dealer with respect to such share. If the applicable broker-dealer is not eligible to receive the deferred selling commission, the dealer manager will rebate to our advisor the deferred selling commission that such broker-dealer would have otherwise been eligible to receive. The deferred selling commissions are ongoing fees that are not paid at the time of purchase.

Payment of the deferred selling commissions with respect to individual Class T shares will cease when they are no longer outstanding, including as a result of conversion to Class A shares and redemption or repurchase. Each Class T share held in a shareholder’s account shall automatically and without any action on the part of the holder thereof convert into a Class A share, on the earliest to occur of the following: (i) a listing of the Class A shares on a national securities exchange; (ii) a merger or consolidation of our company with or into another entity, or the sale or other disposition of all or substantially all of our assets; and (iii) the last calendar day of the month in which we and our dealer manager, in conjunction with our transfer agent, determine that the deferred selling commission paid with respect to the Class T shares held by such shareholder within such account equals or exceeds three percent of the aggregate gross purchase price of the Class T shares held by such shareholder within such account and purchased in a primary offering. In addition, after termination of a primary offering registered under the Securities Act, payment of the deferred selling commission will cease with respect to each Class T share sold in that primary offering, on the date when we, with the assistance of our dealer manager, determine that all underwriting compensation paid or incurred with respect to the primary offering covered by that registration statement from all sources, determined pursuant to the rules and guidance of FINRA, would be in excess of 10% of the aggregate purchase price of all shares sold for our account through that primary offering. Further, each Class T share sold in that primary offering, each Class T share sold under a distribution reinvestment plan pursuant to the same registration statement that was used for that primary offering, and each Class T share received as a stock dividend with respect to such shares sold in such primary offering or distribution reinvestment plan shall automatically and without any action on the part of the holder thereof convert into a Class A share at the last calendar day of the month in which such determination is made. We cannot predict if or when certain of the foregoing events will occur. If we redeem a portion, but not all of the Class T shares held in a shareholder’s account, the underwriting compensation limit and amount of underwriting compensation previously paid will be prorated between the Class T shares that were redeemed and those Class T shares that were retained in the account. Likewise, if a portion of the Class T shares in a shareholder’s account is sold or otherwise transferred in a secondary transaction, the total underwriting compensation limit and amount of underwriting compensation previously paid will be prorated between the Class T shares that were transferred and the Class T shares that were retained in the account.

With respect to the conversion of Class T shares into Class A shares, each Class T share will convert without any action on the part of the holder thereof into a number of Class A shares equal to such Class T share multiplied by a fraction, the numerator of which is the most recent NAV per Class T share and the denominator of which is the most recent NAV per Class A share. Shareholders will receive notice that their Class T shares have been converted into Class A shares in accordance with industry practice at that time, which we expect to be either a transaction confirmation from the transfer agent, notification from the transfer agent or notification through the next account statement following the conversion. We currently expect that the conversion of each Class T share will be on a one-for-on basis, as we expect the NAV per share of each Class A share and Class T share will be the same as there are currently no class-specific expenses associated with the different share classes.

Other Compensation

Subject to FINRA limitations on underwriting compensation, our advisor may also pay directly, or reimburse the dealer manager if they pay on our behalf, certain additional underwriting compensation expenses, including attendance and sponsorship fees payable to soliciting dealers hosting retail seminars, marketing support fees, cost reimbursements for registered representatives of soliciting dealers to attend educational conferences sponsored by us or the dealer manager, and reimbursements for customary travel, lodging, meals and reasonable entertainment expenses and other actual costs of registered persons associated with the dealer manager incurred in the performance of wholesaling activities. We will not reimburse our advisor for any of these expenses. In addition, the Operating Partnership may grant awards of LTIP Units to certain registered persons associated with the dealer manager, which expense will not be reimbursed by our advisor.

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General

Neither we nor our advisor will pay referral or similar fees to any accountants, attorneys, or other persons in connection with the distribution of the shares. We are not responsible for paying any selling commissions or dealer manager fees. The maximum amount of non-transaction based items of compensation to be paid in connection with this offering, including, but not limited to the non-transaction based compensation allocated to dual-employees, will not exceed 1% of the gross primary offering proceeds. No dealer manager fees or selling commissions are payable for shares sold pursuant to our distribution reinvestment plan.

Purchase Price Discounts

We sell Class A shares at a discount to the primary offering price of $10.00 per share through the following distribution channels in the event that the investor:

• pays a broker a single fee, e.g., a percentage of assets under management, for investment advisory and broker services, which is frequently referred to as a “wrap fee”;

• has engaged the services of a registered investment advisor with whom the investor has agreed to pay compensation for investment advisory services or other financial or investment advice (other than a registered investment advisor that is also registered as a broker-dealer who does not have a fixed or “wrap fee” feature or other asset fee arrangement with the investor); or

• is investing through a bank acting as trustee or fiduciary.

If an investor purchases Class A shares through one of these channels in our primary offering, we will sell the Class A shares at a 6.0% discount, or at $9.40 per share, reflecting that selling commissions are not paid in connection with such purchases. To ensure that we receive proceeds equivalent to those received for sales of Class A shares outside these channels our advisor has agreed to waive its asset management each month in an amount equivalent to the 6.0% discount provided to such purchasers in that month. Because of the commission structure for Class T shares, we do not expect sales of our Class T shares to be made through the above distribution channels and therefore these purchase price discounts are not available for Class T share purchases.

If an investor purchases Class A shares in our primary offering net of commissions through a registered investment advisor that is affiliated with a soliciting dealer in a transaction in which the registered investment advisor is compensated on a fee-for-service basis by the investor, the dealer manager may reallow to the affiliated soliciting dealer up to 1% of the gross offering proceeds attributable to that transaction as a marketing fee, or up to 1.25% in select cases as described above. The marketing fee paid to soliciting dealers would be paid by the dealer manager out of its dealer manager fee. If an investor purchases shares in the offering through a registered investment advisor (or bank acting as a trustee or fiduciary) not affiliated with a soliciting dealer, the registered investment adviser may not receive any portion of the dealer manager fee. Neither the dealer manager nor its affiliates compensates any person engaged (or bank acting as a trustee or fiduciary) as an investment advisor by a potential investor as an inducement for such investment advisor to advise favorably for an investment in us.

Total Underwriting Compensation

The table and discussion below sets forth the nature and estimated amount of all items viewed as “underwriting compensation” by FINRA, assuming we sell all $675,000,000 of common stock offered in this primary offering, The maximum selling commissions assumes that 85% and 15% of the gross proceeds raised in the primary offering is from the sale of Class A and Class T shares of common stock, respectively. As we are registering any combination of the two classes, this allocation is management’s best estimate based on the recommendation of our dealer manager and its perceived demand in the market for each respective class of shares.

	Total Compensation(1)
Upfront Selling commissions (maximum)	$	37,462,500
Dealer manager fee (maximum)		20,250,000
Deferred selling commission (maximum)		3,037,500
Additional underwriting expenses(2)		3,000,000
Total	$	63,750,000

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⁽¹⁾  We are not responsible for paying any upfront or deferred selling commissions, dealer manager fees or additional underwriting expenses to the dealer manager or soliciting dealers. Our advisor, CC Advisors III, LLC, is responsible for paying the dealer manager fees, upfront and deferred selling commissions, and additional underwriting expenses, with the exception of any LTIP Units granted by the Operating Partnership, on our behalf without reimbursement from us.

⁽²⁾  Includes additional underwriting expenses that may be paid by our advisor without reimbursement from us, as well as grants of LTIP Units, all as described above under “Other Compensation.”

Under the rules of FINRA, total underwriting compensation in this offering, including selling commissions, the dealer manager fee and any additional expense reimbursements to our dealer manager and soliciting dealers (excluding bona fide invoiced due diligence expenses), may not exceed 10% of our gross offering proceeds from our primary offering. In addition to the limits on underwriting compensation, FINRA and many states also limit our total organization and offering expenses to 15% of gross offering proceeds.

To the extent permitted by law and our charter, we indemnify the soliciting dealers and the dealer manager against some civil liabilities, including certain liabilities under the Securities Act of 1933, as amended (the “Securities Act”), and liabilities arising from breaches of our representations and warranties contained in the dealer manager agreement. See “Management—Limited Liability and Indemnification of Directors, Officers, Employees and Other Agents.”

Management Compensation

Equity Incentive Compensation

We expect to make certain awards to our executive officers in the form of LTIP Units. LTIP Units are a separate series of units of limited partnership interests in the Operating Partnership which we expect to grant as equity awards to certain of our executive officers and registered persons associated with the dealer manager. LTIP Units will be valued by reference to the value of shares of our common stock, and will be subject to such conditions and restrictions as the compensation committee may determine, including continued employment or service, computation of financial metrics and/or achievement of pre-established performance goals and objectives. If applicable conditions and/or restrictions are not attained, participants will forfeit their LTIP Units. Unless otherwise provided, LTIP Unit awards, whether vested or unvested, will entitle the participant to receive current distributions from the Operating Partnership equivalent to the dividends that would be payable with respect to the number of shares of our common stock underlying the LTIP Unit award.

LTIP Units are structured as “profits interests” for U.S. federal income tax purposes, and we do not expect the grant, vesting or conversion of LTIP Units to produce a tax deduction for us based on current U.S. federal income tax law. As profits interests, LTIP Units initially will not have full parity, on a per unit basis, with our Operating Partnership’s common units with respect to liquidating distributions. Upon the occurrence of specified events, LTIP Units can over time achieve full parity with common units and therefore accrete to an economic value for the participant equivalent to common units. If such parity is achieved, LTIP Units may be converted, subject to the satisfaction of applicable vesting conditions, on a one-for-one basis into common units, which in turn are redeemable by the holder for shares of common stock on a one-for-one basis or for the cash value of such shares, at our election. However, there are circumstances under which LTIP Units will not achieve parity with common units, and until such parity is reached, the value that a participant could realize for a given number of LTIP Units will be less than the value of an equal number of shares of common stock and may be zero.

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Grant of LTIP Units

On March 25, 2020, we entered LTIP Unit Award Agreements with Enzio Cassinis, our Chief Executive Officer and President, and Adam Larson, our Chief Financial Officer, as well as certain other executive officers and registered persons associated with the dealer manager, with respect to the grant of LTIP Unit awards from the Operating Partnership as recommended by our compensation committee and approved by our board of directors. Annually, we expect to make additional grants of LTIP Unit awards to these individuals on the same terms and conditions.

The board of directors, upon the recommendation of the compensation committee, approved awards of time-based LTIP Units to Mr. Cassinis in the amount of $45,000 and to Mr. Larson in the amount of $33,750. Each award will vest approximately one-quarter of the awarded amount on January 1, 2021, 2022, 2023 and 2024.

The board of directors, upon the recommendation of the compensation committee, approved awards of performance-based LTIP Units to Mr. Cassinis in the target amount of $135,000 and to Mr. Larson in the target amount of $101,250. The actual amount of each award will be determined at the conclusion of the performance period and will depend on the internal rate of return as defined in the award agreement. The earned LTIP Units will become fully vested on the first anniversary of the last day of the performance period, subject to continued employment with the advisor or its affiliates.

Additional awards of $136,870 performance-based LTIP Units and $45,630 time-based LTIP Units were granted to certain other executive officers and registered persons associated with the dealer manager. The awards are granted effective March 25, 2020, and the number of units will be valued by reference to the estimated value per share of our common stock, currently $10.00.

The time-based and performance-based awards were designed to align the executive officers’ interests with those of our shareholders and to encourage the retention of our executive officers.

Prior Performance Summary

The following discussion supersedes and replaces the “Prior Performance Summary” section of the prospectus.

The information presented in this section represents the historical experience of real estate programs, which we refer to as “prior real estate programs,” sponsored by Cottonwood Residential Inc., Cottonwood Residential O.P., LP and their affiliates. The following summary is qualified in its entirety by reference to the Prior Performance Tables, which may be found in Appendix C of this supplement. Investors in our shares should not assume that they will experience returns, if any, comparable to those experienced by investors in the prior real estate programs. Investors who purchase our shares will not thereby acquire any ownership interest in any of the entities to which the following information relates. Unless specifically noted otherwise, all information in this supplement disclosure is as of December 31, 2019.

Experience and Background of Cottonwood Residential O.P., LP

Our advisor, CC Advisors III, LLC, is a recently formed affiliate of Cottonwood Residential O.P., LP. Prior to September 2018, Cottonwood Residential, Inc., formed on September 24, 2009, was the sole general partner of Cottonwood Residential O.P., LP. Cottonwood Residential II, Inc. was added as a general partner of Cottonwood Residential O.P., LP following a decision by Cottonwood Residential, Inc. to commence a plan to liquidate and restructure its subsidiaries, including Cottonwood Residential O.P., LP.

Cottonwood Residential, Inc. did its investing through Cottonwood Residential O.P., LP, its operating partnership. After the implementation of Cottonwood Residential, Inc.’s liquidation and the admission of Cottonwood Residential II, Inc. as a general partner of Cottonwood Residential O.P., LP in September of 2018, Cottonwood Residential II, Inc. managed the investing activities of Cottonwood Residential O.P., LP. Since Cottonwood Residential O.P., LP’s formation in 2009, Cottonwood Residential O.P., LP, has grown into an industry-leading, fully integrated, national multifamily platform. As of December 31, 2019, Cottonwood Residential O.P., LP provides property and asset management services to a platform of multifamily assets representing approximately 14,000 multifamily apartment units across 13 states with over $2.0 billion in value.

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Cottonwood Residential O.P., LP also has a significant investment platform, holding ownership interests in 28 multifamily apartment communities and other related assets, 22 properties of which represent approximately 6,600 existing units, and 4 properties under development which represent approximately 1,000 additional units, all of which account for approximately $1.0 billion in total gross asset value as of December 31, 2019. Since the formation of Cottonwood Residential, Inc.’s and Cottonwood Residential O.P., LP’s investment platform in 2009, Cottonwood Residential, Inc., Cottonwood Residential II, Inc., and Cottonwood Residential O.P., LP have secured capital commitments through contributions by direct property owners, broker-dealer networks and institutional investors totaling over $770 million as of March 31, 2020.

Cottonwood Residential O.P., LP secured a $127 million commitment in 2011 and an additional $25 million commitment in 2014 from affiliates of FrontRange Capital Partners and Equity Resource Investments to capitalize on attractive multifamily investment opportunities within its managed platform. In addition, in 2015, Cottonwood Residential, Inc. secured an additional $52.5 million debt commitment and $52.5 million equity commitment from Equity Resource Investments. In 2018, Cottonwood Residential O.P., LP repaid all of the outstanding debt and equity investments made by FrontRange Capital Partners and Equity Resource Investments in conjunction with the liquidation mentioned above.

Prior Performance of Cottonwood Residential, Inc., Cottonwood Residential O.P., LP and their Affiliates

Cottonwood Residential O.P., LP became the manager of 11 limited liability companies which were formed to accept the contribution of tenant in common interests in multifamily apartment communities formerly owned by tenant in common owners or which were converted from Delaware statutory trusts. These limited liability companies accepted the contribution of undivided interests in real estate in exchange for limited liability company interests. Approximately 76 investors participated in these limited liability companies. All of the limited liability companies acquired multifamily apartment communities, of which eight were located in the southeastern United States, two were located in the southwestern United States and one was located in the northwestern United States. All of the properties were previously owned. As of December 31, 2019, six of the properties have been sold.

Cottonwood Residential O.P., LP also sponsored the formation of two tenant in common structures. One of these programs was formed in 2015 to acquire a property located in Buford, GA with one investor who contributed approximately $9M to acquire a 20% interest in the property. During 2018, Cottonwood Residential O.P., LP acquired this investor’s interest in the property and now owns 98.7% of the property. The other program was formed in 2017 to acquire a property located in St. Petersburg, FL with two investors who contributed approximately $23M to acquire a 79.5% equity interest in the property. The property had previously been 100% owned by Cottonwood Residential O.P., LP.

Cottonwood Capital Property Management II, LLC, a wholly owned subsidiary of Cottonwood Residential O.P., LP, sponsored Cottonwood Multifamily REIT I, Inc. Cottonwood Multifamily REIT I, Inc. conducted a $50,000,000 offering that was qualified as a “Tier 2” offering pursuant to Regulation A promulgated under the Securities Act from May 2016 through April 2017, raising the full offering amount from approximately 1,300 investors. It has acquired interests in three multifamily apartment communities, one located in Florida, one located in North Carolina and one located in Georgia. The total purchase price for the portion of the properties acquired by Cottonwood Multifamily REIT I, Inc. was approximately $126,796,500. The properties were acquired using permanent financing in the amount of approximately $89,900,000 (of which $80,910,000 is allocable to Cottonwood Multifamily REIT I, Inc.’s interest in the properties). Cottonwood Multifamily REIT I, Inc. reached the minimum offering amount on September 2, 2016 and has made daily distributions equivalent to 5.75% of original purchase price on an annualized basis since that time. Distributions have been paid each month beginning October 2016. See Appendix C, Table I for more information on this offering.

Cottonwood Capital Property Management II, LLC, a wholly owned subsidiary of Cottonwood Residential O.P., LP also sponsored Cottonwood Multifamily REIT II, Inc. Cottonwood Multifamily REIT II, Inc. conducted a $50,000,000 offering that was qualified as a “Tier 2” offering pursuant to Regulation A promulgated under the Securities Act from July 2017 through August 2018, raising the full offering amount from approximately 1,100

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investors. It has acquired interests in two multifamily apartment communities, one located in Massachusetts, and one located in North Carolina. The total purchase price for the portion of the properties acquired by Cottonwood Multifamily REIT II, Inc. was approximately $100,177,000. The properties were acquired using permanent financing in the amount of approximately $71,760,000 (of which approximately $54,834,000 is allocable to Cottonwood Multifamily REIT II, Inc.’s interest in the properties). Cottonwood Multifamily REIT II, Inc. reached its minimum offering amount on September 27, 2017 and has made daily distributions equivalent to 5.25% of original price on an annualized basis since that time. Distributions have been paid each month beginning October 2017. See Appendix C, Table I for more information on this offering.

Cottonwood Capital Property Management II, LLC, a wholly owned subsidiary of Cottonwood Residential O.P., LP, also sponsored Cottonwood Multifamily Opportunity Fund, Inc. Cottonwood Multifamily Opportunity Fund, Inc. conducted a $50,000,000 offering that was qualified as a “Tier 2” offering pursuant to Regulation A promulgated under the Securities Act from November 2017 through August 2019, raising the full offering amount from 1,133 investors. Through two separate joint ventures with an affiliate, it has made investments in two multifamily development projects in Salt Lake City, Utah. It is required to commit up to a total of $15.8 million and $23.2 in capital for the development of each of the respective projects. See Appendix C, Table I for more information on this offering.

Cottonwood Residential O.P., LP has also sponsored the formation of a qualified opportunity fund under the Tax Cuts and Jobs Act of 2017. The fund was formed in 2019 to be a member of a joint venture that will acquire and develop a multifamily apartment community in Millcreek, Utah. As of December 31, 2019, the fund had completed its external offering, raising $23,587,903 from 42 investors, including $3,974,720 from affiliated investors. Cottonwood Residential O.P., LP has also contributed $6,400,000 to the fund. The joint venture purchased the land for the development for $5,040,000.

The following table sets forth information regarding these 11 limited liability companies, two tenant in common transactions, Cottonwood Multifamily REIT I, Inc., Cottonwood Multifamily REIT II, Inc., Cottonwood Multifamily Opportunity Fund, Inc. and the qualified opportunity fund.

Name of Program	Type of Program	Launch Year	Program Status
Pavilions	Limited Liability Company	2011	Operating
Lily Flagg	Limited Liability Company	2011	Closed/Sold
Waterford Creek	Limited Liability Company	2012	Closed/Sold
Appling Lakes	Limited Liability Company	2012	Closed/Sold
Midtown Crossing	Limited Liability Company	2013	Closed/Sold
Brook Highland Place	Limited Liability Company	2013	Closed/Sold
Toscana	Limited Liability Company	2015	Closed(1)
Scott Mountain	Limited Liability Company	2015	Operating
Cottonwood Reserve (formerly Courtney Oaks)	Limited Liability Company	2015	Operating
Sanctuary	Limited Liability Company	2015	Closed/Sold
Summer Park	Tenant in Common	2015	Closed
Arbors at Fairview	Limited Liability Company	2016	Closed/Sold
Cottonwood Multifamily REIT I, Inc.	REIT	2016	Operating
Cottonwood Multifamily REIT II, Inc.	REIT	2017	Operating
Cottonwood Bayview	Tenant in Common	2017	Operating
Cottonwood Multifamily Opportunity Fund, Inc.	REIT	2017	Operating
Highland	Qualified Opportunity Fund	2017	Operating

⁽¹⁾ In 2017 this program converted from a limited liability company to a tenant in common program.

Neither Cottonwood Residential, Inc., nor Cottonwood Residential O.P., LP, nor their affiliates have sponsored any prior public programs that disclosed a liquidity event date. See Appendix C, Table III, Annual Operating Results of Prior Real Estate Programs for information regarding the last five programs sponsored by Cottonwood Residential O.P., LP.

Cottonwood Capital, LLC, which became a subsidiary of Cottonwood Residential O.P., LP in 2011, was formed in 2005 for the purpose of offering tenant in common interests in multifamily residential apartment communities. Cottonwood Capital, LLC or its affiliates sponsored 17 tenants in common programs. These prior tenants in common programs raised more than $157 million from over 419 investors. Purchasers who participated in more than one prior tenant in common program were counted as an investor for each such program. The tenant in common programs purchased 17 properties for an aggregate purchase price of more than $412 million, of which 4 were located in the southeastern United States, 9 were located in the southwestern United States, 1 was located in the northwestern United States and 3 were located in the western United States. All of the properties were previously owned. All of the properties were multifamily residential properties. Of these 17 programs, 13 have been sold as of December 31, 2019. The following table sets forth information regarding the 17 tenants in common programs.

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Name of Program	Type of Program	Launch Year	Program Status
Northwest Corners	Tenant in Common	2005	Closed/Sold
Scott Mountain	Tenant in Common	2005	Closed
Tramore Village	Tenant in Common	2005	Closed/Sold
Camelot	Tenant in Common	2006	Closed/Sold
Valencia Park	Tenant in Common	2006	Closed/Sold
Fox Point	Tenant in Common	2006	Operating
Greenbrier	Tenant in Common	2006	Closed/Sold
Water Song	Tenant in Common	2007	Closed/Sold
Cottonwood Apartments	Tenant in Common	2007	Closed
West Town	Tenant in Common	2007	Closed/Sold
Gables Apartments	Tenant in Common	2007	Closed/Sold
Arbors at Windsor Lake	Tenant in Common	2008	Closed/Sold
Regatta	Tenant in Common	2008	Closed
Oak Ridge	Tenant in Common	2008	Closed/Sold
Copperfield	Tenant in Common	2008	Closed/Sold
Blue Swan	Tenant in Common	2008	Closed/Sold
Arbor Crossing	Tenant in Common	2009	Closed/Sold

See Appendix C, Table IV Operating Results of Prior Real Estate Programs Which Have Completed Operations, for information regarding the last five real estate programs that have been sold.

Prior Programs with Adverse Results

The following is a summary of the prior real estate programs of Cottonwood Capital, LLC and its affiliates as of December 31, 2019 that have experienced adverse results.

Copperfield, a multifamily apartment community located in San Antonio, Texas, was acquired in September, 2008 and sold by the tenant in common owners in September, 2015. When distributions are included, investors experienced an average annualized rate of return on the investor’s initial equity invest of -0.98%.

Tramore Village, a multifamily apartment community located in Austell, Georgia, was acquired in December, 2005 and sold by the tenant in common owners in June, 2015. When distributions are included, investors experienced an average annualized rate of return on the investor’s initial equity investment of -0.29%.

Valencia Park, a multifamily apartment community located in Norcross, Georgia, was acquired in March, 2006 and sold by the tenant in common owners in March, 2015. When distributions are included, investors experienced an average annualized rate of return on the investor’s initial equity investment of -12.95%.

In addition, the prior real estate programs listed above were established from 2005 to 2009. In 2008, the United States economy experienced a significant recession. Real estate values in the United States were severely impacted. As a result of the recession, all of the prior real estate programs, at one or more times, failed to meet the projected distribution initially made by Cottonwood Capital, LLC and its affiliates with respect to such investment. See Appendix C, Table III Annual Operating Results of Prior Real Estate Programs and Table IV Operating Results of Prior Real Estate Programs Which Have Completed Operations for more detailed information regarding the performance of some of the prior real estate programs. All prior programs for which anticipated liquidation dates were set forth in the original offering document, and for which such dates have passed, were liquidated on or before the anticipated liquidation date.

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Description of Shares

Preferred Stock

On November 8, 2019, we classified and designated 5,000,000 shares of our authorized but unissued preferred stock as shares of non-voting Series 2019 preferred stock. The Series 2019 preferred stock, with respect to dividend rights and rights upon voluntary or involuntary liquidation, dissolution or winding up of the company, ranks senior to the common stock.

Shareholders of Series 2019 preferred stock are entitled to, when and as authorized by our board of directors and declared by us, cash dividends at the rate of 5.5% per annum of $10.00 per share (equivalent to a fixed annual rate of $0.55 per share). If we extend the term of the Series 2019 preferred stock beyond December 31, 2023, such rate will increase to 6.0% per annum of $10.00 per share (equivalent to a fixed annual rate of $0.60 per share). Dividends will accrue and be cumulative from and including the first date on which the Series 2019 preferred stock is issued.

Upon any voluntary or involuntary liquidation, dissolution or winding up of the company, the shareholders of Series 2019 preferred stock will be entitled to receive a liquidation preference of $10.00 (the “Purchase Price”), plus any accrued and unpaid dividends (whether or not authorized or declared) thereon to and including the date of payment, before any payments are made to the holders of the common stock.

We must redeem the Series 2019 preferred stock for cash at a redemption price per share equal to the Purchase Price plus any accrued and unpaid dividends thereon to, and including, the redemption date, to the extent there are funds legally available therefor on December 31, 2023, which date may be extended by two 1-year extension options.

Preferred Stock Private Offering

On November 8, 2019, we launched a best-efforts private placement offering exempt from registration pursuant to Rule 506(b) of Regulation D of the Securities Act pursuant to which we are offering shares of our Series 2019 preferred stock to accredited investors only. In connection with the private offering, we entered a managing broker dealer agreement with an unaffiliated third party to act as the managing broker dealer for the private offering. Pursuant to the terms of the managing broker dealer agreement, the managing broker dealer will receive selling commissions in an amount up to 6% of the gross offering proceeds from the private offering, which it will reallow to selling group members, and a placement fee in an amount up to 3% of the gross offering proceeds from the private offering, which it will reallow, in whole or in part, to certain wholesalers which are internal to affiliates of our advisor. We will be responsible for paying all of the expenses associated with the private offering and anticipate that total offering expenses will be approximately $4,750,000 if the maximum offering amount is raised. As of April 10, 2020, we had sold 965,894 shares of Series 2019 Preferred Stock for aggregate gross offering proceeds of $9,621,279. In connection with the sale of these shares in the private offering, we paid aggregate selling commissions of $632,689 and placement fees of $188,204. The managing broker dealer agreement requires us to indemnify the managing broker dealer with respect to liabilities, including certain civil liabilities under the Securities Act, which may arise in connection with the private offering.

The Operating Partnership Agreement

On March 25, 2020, we entered the Amended and Restated Limited Partnership Agreement of Cottonwood Communities O.P., LP to be effective as of February 1, 2020 (the “Amended OP Agreement”). The Amended OP Agreement establishes the terms of a new series of partnership units designated as LTIP Units, which we intend to issue annually as equity awards to certain of our executive officers and registered persons associated with our dealer manager. In addition, the Amended OP Agreement reflects certain other amendments to the original agreement to permit the admission of limited partners to the Operating Partnership in addition to the current sole limited partner, Cottonwood Communities Investor, LLC.

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The following discussion of the operating partnership agreement supersedes and replaces the discussion in the prospectus.

General

Cottonwood Communities O.P., LP, which we refer to as the operating partnership, is a Delaware limited partnership. We expect to own substantially all of our assets and conduct our operations through the operating partnership. We are the sole general partner of our operating partnership. As the general partner, we have the exclusive power to manage and conduct the business of the operating partnership. Currently, the sole limited partner of the operating partnership is Cottonwood Communities Investor, LLC, a wholly owned subsidiary of Cottonwood Residential O.P. Cottonwood Communities Investor, LLC has assigned its right in the promotional interest in our partnership to Cottonwood Advisors Promote, LLC.

As we accept subscriptions for shares in this offering, we transfer all of the proceeds of the offering to our operating partnership as a capital contribution in exchange for units of general partnership interest. We are the only general partner in the operating partnership. We currently have issued general partner units and preferred interests from our operating partnership. In addition, we have amended the operating partnership agreement to provide for common limited partners units and LTIP units. The common units will allow us to receive contributions of property. In the future we may issue additional new classes of operating partnership interests with unique terms, preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications and terms or conditions of redemption.

As a result of this structure, we are considered an UPREIT, or an umbrella partnership real estate investment trust. For purposes of satisfying the asset and income tests for qualification as a REIT, the REIT’s proportionate share of the assets and income of the operating partnership will be deemed to be assets and income of the REIT.

Capital Contributions

We initially contributed $200,000 to the partnership in exchange for our general partner interest and have contributed all proceeds from our offerings. Cottonwood Communities Investor, LLC, was not required to make a capital contribution in exchange for its limited partnership interest. We plan to contribute the proceeds of this offering to the operating partnership as an additional capital contribution. The operating partnership has also issued preferred general partnership interests. In addition, if we accept contributions of property in our operating partnership, our percentage ownership interest in the operating partnership will be adjusted to reflect the relative ownership percentages of the property contributors and us. If the operating partnership would require additional funds at any time in excess of capital contributions made by us or from borrowings, we could borrow funds from a financial institution or other lender and lend such funds to the operating partnership on the same terms and conditions as are applicable to our borrowing of such funds.

Operations

The partnership agreement of our operating partnership provides that, so long as we remain qualified as a REIT, the operating partnership will be operated in a manner that will enable us to satisfy the requirements for being classified as a REIT for tax purposes.

Distributions and Allocations of Profits and Losses

Cash from Operations (which includes cash from capital transactions) from our operating partnership is distributed as follows:

(1) First, to the general partner (us) for our preferred interest;

(2) Second, 100% to the general partner (us) and the common unit holders and the LTIP unit holders until our shareholders have received distributions in an aggregate amount equal to the sum of (i) a 6% cumulative, non-compounded, annual return on their invested capital and (ii) a return of their invested capital; and

(3) Thereafter, 85% to the general partner (us) and 15% to Cottonwood Communities Advisors Promote, LLC.

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Cottonwood Communities Advisors Promote, LLC has the right to receive certain distributions to pay income taxes. Notwithstanding the above, upon the sale or exchange of the last property or liquidation of the operating partnership, Cottonwood Communities Advisors Promote, LLC will contribute prior income tax related distributions it has received from the operating partnership to the extent that the tax distributions cause Cottonwood Communities Advisors Promote, LLC to receive distributions that exceed the amount that would have been distributed to Cottonwood Communities Advisors Promote, LLC if Cottonwood Communities Advisors Promote, LLC did not receive such distributions.

The operating partnership will make allocations of income and loss so that the allocations are made in a similar manner to the distributions. Losses will not be passed through to our shareholders. In addition, the LTIP holders will receive certain “Liquidating Gains and Liquidating Losses” to properly reflect their interest in the operating partnership.

Rights, Obligations and Powers of the General Partner

Under the partnership agreement of our operating partnership, the general partner has all power and authority as a general partner is able to have under the Delaware Revised Uniform Limited Partnership Act, as amended. We are the sole general partner of our operating partnership. As the sole general partner, we have complete and exclusive discretion to manage and control the operating partnership’s business and to make all decisions affecting its assets.

We expect that the operating partnership would continue to pay all of the administrative and operating costs and expenses it incurs in acquiring or originating and operating and managing our investments. Other than organizational and offering expenses paid by CC Advisors III, LLC, we expect the operating partnership would also pay all of our administrative costs and expenses and such expenses would be treated as expenses of the operating partnership. Such expenses would include:

• all expenses relating to our continuity of existence;

• all expenses associated with the preparation and filing of our periodic reports under federal, state, or local laws or regulations; and

• all of our other operating or administrative costs incurred in the ordinary course of business.

Other than organizational and offering expenses paid by CC Advisors III, LLC, the only costs and expenses we could incur that the operating partnership would not reimburse would be costs and expenses relating to assets we may own outside of the operating partnership. We would pay the expenses relating to such assets directly.

Change in General Partner

We generally would not be able to withdraw as the general partner of our Operating Partnership or transfer our general partnership interest in our operating partnership (unless we transferred our interest to a wholly owned subsidiary).

Amendment of Limited Partnership Agreement

The partnership agreement of our operating partnership may be amended with our consent as general partner and in certain cases the limited partners. The partnership agreement of our operating partnership will be amended if additional limited partners are admitted.

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Experts

The consolidated financial statements of Cottonwood Communities, Inc. as of December 31, 2019 and 2018, and for each of the years in the two-year period ended December 31, 2019, have been incorporated by reference herein and in the registration statement in reliance upon the report of KPMG LLP, independent registered public accounting firm, incorporated by reference herein, and upon the authority of said firm as experts in accounting and auditing.

The statement of revenues and certain operating expenses of Cottonwood West Palm for the year ended December 31, 2018, has been incorporated by reference herein and in the registration statement from Cottonwood Communities, Inc.’s Current Report on Form 8-K/A as filed with the SEC on August 1, 2019 in reliance upon the report of WSRP, LLC, independent auditor, incorporated by reference herein, and upon the authority of said firm as experts in accounting and auditing.

Incorporation of Certain Information by Reference

We have elected to “incorporate by reference” certain information into this prospectus. By incorporating by reference, we are disclosing important information to you by referring you to documents we have filed separately with the SEC. The information incorporated by reference is deemed to be part of this prospectus, except for information incorporated by reference that is superseded by information contained in this prospectus. You can access documents that are incorporated by reference into this prospectus at our website at http://www.cottonwoodcommunities.com. There is additional information about us and our advisor and its affiliates at the website, but unless specifically incorporated by reference herein as described in the paragraphs below, the contents of that site are not incorporated by reference in or otherwise a part of this prospectus.

The following documents filed with the SEC are incorporated by reference in this prospectus (Commission File No. 333-215272), except for any document or portion thereof deemed to be “furnished” and not filed in accordance with SEC rules:

• Annual Report on Form 10-K for the year ended December 31, 2019 filed with the SEC on March 25, 2020;

• Current Report on Form 8-K filed with the SEC on April 2, 2020;

• Current Report on Form 8-K filed with the SEC on March 16, 2020;

• Current Report on Form 8-K filed with the SEC on March 9, 2020;

• Current Report on Form 8-K filed with the SEC on March 2, 2020;

• Current Report on Form 8-K filed with the SEC on February 24, 2020;

• Current Report on Form 8-K filed with the SEC on February 18, 2020;

• Current Report on Form 8-K filed with the SEC on February 11, 2020;

• Current Report on Form 8-K filed with the SEC on February 3, 2020;

• Current Report on Form 8-K filed with the SEC on January 28, 2020;

• Current Report on Form 8-K filed with the SEC on January 22, 2020;

• Current Report on Form 8-K filed with the SEC on January 9, 2020; and

• Current Report on Form 8-K/A filed with the SEC on August 1, 2019.

S-22

We will provide to each person, including any beneficial owner, to whom this prospectus is delivered, upon request, a copy of any or all of the information that we have incorporated by reference into this prospectus but not delivered with this prospectus. To receive a free copy of any of the documents incorporated by reference in this prospectus, other than exhibits, unless they are specifically incorporated by reference in those documents, call or write us at:

Cottonwood Communities, Inc.

6340 South 3000 East, Suite 500

Salt Lake City, Utah 84121

Telephone: (801) 278-0700

The information relating to us contained in this prospectus does not purport to be comprehensive and should be read together with the information contained in the documents incorporated or deemed to be incorporated by reference in this prospectus.

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APPENDIX C

PRIOR PERFORMANCE TABLES

The following disclosure supersedes and replaces Appendix C in the prospectus.

The following prior performance tables provide information relating to the real estate investment programs sponsored by Cottonwood Residential II, Inc., Cottonwood Residential, Inc., Cottonwood Residential O.P., LP and their affiliates, collectively referred to herein as the “prior real estate programs.” These programs were not prior programs of Cottonwood Communities, Inc. Prior to the commencement of its plan to liquidate and restructure its subsidiaries that was completed in September 2018, Cottonwood Residential, Inc. was a real estate investment trust that, through its affiliates and subsidiaries, and in particular, through Cottonwood Residential O.P., LP, its operating partnership, provided real estate investment and management services and acted as the initial sponsor of this offering. In September 2018, Cottonwood Residential II, Inc. was admitted as an additional general partner of Cottonwood Residential O.P., LP along with Cottonwood Residential, Inc., as a nominal general partner, and directs the investment activities of Cottonwood Residential O.P., LP going forward. We consider Cottonwood Residential II, Inc. to be our current sponsor. As the leadership of Cottonwood Residential, Inc. remains intact at Cottonwood Residential II, Inc. we have continued to provide information regarding real estate investment programs sponsored by Cottonwood Residential, Inc. Cottonwood Capital Property Management II, Inc., an indirect subsidiary of Cottonwood Capital Management, Inc., and Cottonwood Residential, Inc., sponsored Cottonwood Multifamily REIT I, Inc. and Cottonwood Multifamily REIT II, Inc. which are real estate investment trusts that have investment objectives similar to us. The other prior programs consisted of tenant in common offerings which had investment objectives that targeted investors who were completing tax deferred exchanges under Section 1031 of the Internal Revenue Code of 1986, as amended, and entities that were formed to accept the contribution of tenant in common interests in property in exchange for interests in such entity. Thus, while these prior programs acquired multifamily real estate, the investment objectives of such prior programs were not similar to those of Cottonwood Communities, Inc.

This information should be read together with the summary of information included in the “Prior Performance Summary” section of this supplement.

INVESTORS SHOULD NOT CONSTRUE INCLUSION OF THE FOLLOWING TABLES AS IMPLYING, IN ANY MANNER, THAT WE WILL HAVE RESULTS COMPARABLE TO THOSE REFLECTED IN SUCH TABLES. DISTRIBUTABLE CASH FLOW, FEDERAL INCOME TAX DEDUCTIONS OR OTHER FACTORS COULD BE SUBSTANTIALLY DIFFERENT. INVESTORS SHOULD NOTE THAT, BY ACQUIRING OUR SHARES, THEY WILL NOT BE ACQUIRING ANY INTEREST IN ANY PRIOR PROGRAM.

Description of the Tables

All information contained in the Tables in this Appendix C is as of December 31, 2019. The following tables are included herein:

Table I – Experience in Raising and Investing Funds

Table III – Annual Operating Results of Prior Real Estate Programs

Table IV – Operating Results of Prior Real Estate Programs Which Have Completed Operations

Table III includes information regarding the last five prior programs offered by Cottonwood Residential O.P., LP and its affiliates. Table IV includes information regarding the last five completed prior programs offered by Cottonwood Residential O.P., LP and its affiliates.

We have not included in this Appendix C Table II (Compensation to Sponsor) or Table V (Sale or Disposition of Properties by Prior Real Estate Programs) because the information contained in these tables is not applicable to the prior programs.

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TABLE I

EXPERIENCE IN RAISING AND INVESTING FUNDS

(UNAUDITED)

Table I sets forth the experience in raising and investing funds of prior real estate programs whose offerings closed during the three years ending December 31, 2019. All figures are as of December 31, 2019.

	Cottonwood Multifamily REIT I, Inc.
Dollar amount offered	$	50,000,000
Dollar amount raised	$	50,000,000
Length of Offering		9 months
Months to invest 90% of amount available for investment		<1 month

	Cottonwood Multifamily REIT II, Inc.
Dollar amount offered	$	50,000,000
Dollar amount raised	$	50,000,000
Length of Offering		13 months
Months to invest 90% of amount available for investment		18 months

	Cottonwood Multifamily Opportunity Fund, Inc.
Dollar amount offered	$	50,000,000
Dollar amount raised	$	50,000,000
Length of Offering		9 months
Months to invest 90% of amount available for investment		N/A	(1)

⁽¹⁾  Cottonwood Multifamily Opportunity Fund, Inc. is still investing the proceeds raised in its offering that terminated in August 2019.

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TABLE III

ANNUAL OPERATING RESULTS OF PRIOR PROGRAMS

(UNAUDITED)

Table III sets forth the annual operating results of prior real estate programs during the five years ending December 31, 2019. All figures are as of December 31, 2019 (amounts in dollars and thousands). All of the offerings for the prior real estate programs described in this Table III have closed.

Cottonwood Multifamily REIT I	2015		2016			2017			2018			2019
Summary Balance Sheet Data at December 31,
Total assets (before depreciation)		10		51,921			50,833			47,831			47,105
Total assets (after depreciation)		10		48,784			43,134			36,796			31,797
Liabilities		—		(24,444	)		(2,162	)		(421	)		(1,371	)
Summary Income Statement Data (1)
Gross revenues		—		4,344			10,778			11,405			11,476
Operating expenses		—		(1,859	)		(4,737	)		(4,695	)		(4,861	)
Operating income		—		2,485			6,041			6,710			6,615
Interest expense		—		(2,106	)		(2,995	)		(3,132	)		(3,251	)
Non-operating, including depreciation and amortization		—		(3,584	)		(5,871	)		(5,189	)		(6,018	)
Net loss		—		(3,205	)		(2,825	)		(1,611	)		(2,654	)
Summary Cash Flows Data (1)
Cash provided by (used in) operating activities		—		—			1,243			(86	)		2,595
Cash (used in) provided by investing activities		—		(48,199	)		—			3,747			—
Cash provided by (used in) financing activities		10		50,570			(3,333	)		(2,990	)		(3,297	)
Net increase (decrease) in cash		—		2,371			(2,090	)		671			(702	)
Amount and Source of Distributions
Distributions from operations		—		—			—			—			2,595
Distributions from financing		—		144			2,585			2,867			264
Distributions from sales		—		—			—			—			—
Distributions from offering proceeds		—		—			—			—			—
Share Valuation
Estimated per share at December 31, (2)				10.00			11.01			11.31			12.21

⁽¹⁾  Operating results and cash flow data include Cottonwood Multifamily REIT I’s share of property activity based on its ownership interests in real estate joint ventures.

⁽²⁾  Prior to December 31, 2017, Cottonwood Multifamily REIT I valued its shares at $10.00 per share based solely on the offering price in its offering.

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TABLE III

ANNUAL OPERATING RESULTS OF PRIOR PROGRAMS

(UNAUDITED)

Table III sets forth the annual operating results of prior real estate programs during the five years ending December 31, 2019. All figures are as of December 31, 2019 (amounts in dollars and thousands). All of the offerings for the prior real estate programs described in this Table III have closed.

Cottonwood Multifamily REIT II	2015		2016		2017			2018			2019
Summary Balance Sheet Data at December 31,
Total assets (before depreciation)		—		10		16,166			47,984			47,118
Total assets (after depreciation)		—		10		16,166			46,487			40,847
Liabilities		—		—		(73	)		(240	)		(1,036	)
Summary Income Statement Data (1)
Gross revenues		—		—		—			1,830			8,580
Operating expenses		—		—		—			(761	)		(3,559	)
Operating income		—		—		—			1,069			5,021
Interest expense		—		—		—			(471	)		(2,382	)
Non-operating, including depreciation and amortization		—		—		(11	)		(2,086	)		(6,242	)
Net loss		—		—		(11	)		(1,488	)		(3,603	)
Summary Cash Flows Data (1)
Cash (used in) provided by operating activities		—		—		(2	)		(725	)		2,563
Cash used in investing activities		—		—		—			(19,365	)		(27,461	)
Cash provided by (used in) financing activities		—		10		15,888			32,067			(2,834	)
Net increase in cash		—		10		15,886			11,977			(27,732	)
Amount and Source of Distributions
Distributions from operations		—		—		—			—			2,563
Distributions from financing		—		—		69			1,907			56
Distributions from sales		—		—		—			—			—
Distributions from offering proceeds		—		—		—			—			—
Share Valuation
Estimated per share at December 31, (2)						10.00			10.00			10.46

⁽¹⁾  Operating results and cash flow data include Cottonwood Multifamily REIT II’s share of property activity based on its ownership interests in real estate joint ventures.

⁽²⁾  Prior to December 31, 2019, Cottonwood Multifamily REIT II valued its shares at $10.00 per share based solely on the offering price in its offering.

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TABLE III

ANNUAL OPERATING RESULTS OF PRIOR PROGRAMS

(UNAUDITED)

Table III sets forth the annual operating results of prior real estate programs during the five years ending December 31, 2019. All figures are as of December 31, 2019 (amounts in dollars and thousands). All of the offerings for the prior real estate programs described in this Table III have closed.

Cottonwood Multifamily Opportunity Fund	2015		2016		2017			2018			2019
Summary Balance Sheet Data at December 31,
Total assets (before depreciation)		—		10		10			22,744			51,701
Total assets (after depreciation)		—		10		10			22,744			51,701
Liabilities		—		—		1			25			91
Summary Income Statement Data (1)
Gross revenues		—		—		—			19			605
Operating expenses		—		—		—			(157	)		(676	)
Operating income		—		—		—			(138	)		(71	)
Interest expense		—		—		—			—			—
Non-operating, including depreciation and amortization		—		—		(1	)		—			—
Net loss		—		—		(1	)		(138	)		(71	)
Summary Cash Flows Data (1)
Cash used in operating activities		—		—		—			(147	)		12
Cash used in investing activities		—		—		—			(6,448	)		(14,201	)
Cash provided by financing activities		—		—		—			22,810			28,958
Net increase in cash		—		—		—			—			—
Amount and Source of Distributions
Distributions from operations		—		—		—			—			—
Distributions from financing		—		—		—			—			—
Distributions from sales		—		—		—			—			—
Distributions from offering proceeds		—		—		—			—			—
Share Valuation
Estimated per share at December 31, (2)									10.00			10.00

⁽¹⁾  Operating results and cash flow data include Cottonwood Multifamily Opportunity Fund’s share of property activity based on its ownership interests in real estate joint ventures.

⁽²⁾  Cottonwood Multifamily Opportunity Fund valued its shares at $10.00 per share based solely on the offering price in its offering.

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TABLE III

ANNUAL OPERATING RESULTS OF PRIOR PROGRAMS

(UNAUDITED)

Table III sets forth the annual operating results of prior real estate programs during the five years ending December 31, 2019. All figures are as of December 31, 2019 (amounts in dollars and thousands). All of the offerings for the prior real estate programs described in this Table III have closed.

Toscana at Valley Ridge	2015			2016			2017			2018			2019
Summary Balance Sheet Data at December 31,
Total assets (before depreciation)		31,114			31,631			31,418			31,362			32,277
Total assets (after depreciation)		30,636			30,059			28,723			27,521			26,301
Liabilities		(19,911	)		(19,929	)		(19,828	)		(19,617	)		(19,296	)
Summary Income Statement Data (1)
Gross revenues		1,250			3,079			3,432			3,546			3,820
Operating expenses		(630	)		(1,384	)		(1,436	)		(1,522	)		(1,761	)
Operating income		620			1,695			1,996			2,024			2,059
Interest expense		(358	)		(834	)		(831	)		(851	)		(837	)
Non-operating, including depreciation and amortization		(1,284	)		(1,224	)		(1,117	)		(1,144	)		(1,101	)
Net loss		(1,021	)		(363	)		48			29			121
Summary Cash Flows Data (1)
Cash provided by operating activities		690			1,805			1,196			1,205			1,203
Cash (used in) provided by investing activities		(13	)		(634	)		601			(320	)		(115	)
Cash used in financing activities		(43	)		—			(102	)		(317	)		(1,352	)
Net increase (decrease) in cash		635			1,171			1,695			568			(264	)
Amount and Source of Distributions
Distributions from operations		—			200			1,252			1,013			1,021
Distributions from financing		—			—			—			—			—
Distributions from sales		—			—			—			—			—
Distributions from offering proceeds		—			—			—			—			—

⁽¹⁾  Operating results and cash flow data represent 100% of the property results from Cottonwood Residential O.P., LP’s initial acquisition date forward.

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TABLE III

ANNUAL OPERATING RESULTS OF PRIOR PROGRAMS

(UNAUDITED)

Table III sets forth the annual operating results of prior real estate programs during the five years ending December 31, 2019. All figures are as of December 31, 2019 (amounts in dollars and thousands). All of the offerings for the prior real estate programs described in this Table III have closed.

Cottonwood Bayview	2015		2016			2017			2018			2019
Summary Balance Sheet Data at December 31,
Total assets (before depreciation)		—		78,286			76,841			77,492			79,753
Total assets (after depreciation)		—		78,183			74,221			72,338			70,041
Liabilities		—		(50,043	)		(50,369	)		(50,292	)		(49,483
Summary Income Statement Data (1)
Gross revenues		—		179			3,362			7,009			7,149
Operating expenses		—		(48	)		(1,450	)		(3,049	)		(3,036	)
Operating income		—		131			1,912			3,960			4,113
Interest expense		—		(55	)		(963	)		(1,942	)		(1,926	)
Non-operating, including depreciation and amortization		—		(679	)		(3,124	)		(2,539	)		(2,574	)
Net income (loss)		—		(603	)		(2,175	)		(521	)		(387	)
Summary Cash Flows Data
Cash provided by operating activities		—		—			1,105			2,062			1,994
Cash used in investing activities		—		—			(239	)		(155	)		(156	)
Cash used in financing activities		—		—			—			—			(1,918	)
Net increase (decrease) in cash		—		—			1,105			1,907			(80	)
Amount and Source of Distributions
Distributions from operations		—		—			1,563			1,285			1,100
Distributions from financing		—		—			—			—			—
Distributions from sales		—		—			—			—			—
Distributions from offering proceeds		—		—			—			—			—

⁽¹⁾  Operating results and cash flow data represent 100% of the property results from Cottonwood Residential O.P., LP’s initial acquisition date forward.

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TABLE IV

OPERATING RESULTS OF COMPLETED PRIOR PROGRAMS

(UNAUDITED)

Table IV presents information regarding the operating results of the last five prior real estate programs that have completed operations (no longer hold properties) during the five years ended December 31, 2019. All amounts presented are as of December 31, 2019.

	Arbors at Fairview			Midtown Crossing			Oak Ridge			Regatta			Waterford Creek
Aggregate Dollar Amount Raised	$	6,800,960		$	6,435,000		$	8,500,000		$	13,375,000		$	4,932,430
Duration of Program (Months)		22			58			121			118			78
Date of Program Closing		9/28/2018			9/28/2018			3/29/2018			1/2/2018			9/28/2018
Total Compensation Paid to Sponsor (1)	$	888,306		$	780,458		$	2,699,777		$	2,444,655		$	968,416
Median Leverage		67	%		47	%		80	%		76	%		78	%
Annualized Return on Investment(2)		51.7	%		23.6	%		9.6	%		9.0	%		32.7	%
Start Date		11/15/2016			11/11/2013			2/28/2008			2/11/2008			3/23/2012
End Date		9/28/2018			9/28/2018			3/29/2018			1/2/2018			9/28/2018
Median Month		Oct-17			Apr-16			Mar-13			Jan-13			Jun-15

⁽¹⁾ Includes acquisition fees, property and asset management fees, disposition fees, financing fees, and other ancillary services. A portion of these fees are used to reimburse costs incurred by the Sponsor.

⁽²⁾ Annualized return on investment is the internal rate of return over the program period using the respective cash flows from invested capital, distributions received, and proceeds from sale.

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PART II. INFORMATION NOT REQUIRED IN PROSPECTUS

Item 31. Other Expenses of Issuance and Distribution

The following table sets forth the costs and expenses payable by the advisor of Cottonwood Communities, Inc. (the “Company”) on behalf of the Company in connection with the distribution of the securities being registered other than selling commissions and the dealer manager fee. All amounts are estimated except the SEC registration fee and the FINRA filing fee.

Item	Amount
SEC registration fee		89,075
FINRA filing fee		113,000
Legal fees and expenses		2,000,000
Blue sky fees and expenses		225,000
Accounting fees and expenses		550,000
Sales and advertising expenses		638,000
Issuer costs regarding bona fide training and education meetings and retail seminars		1,950,000
Additional underwriting expenses		3,000,000
Printing		250,000
Postage and delivery of materials		150,000
Transfer agent and escrow fees		264,000
Due diligence expenses		456,500
Other expenses related to registration and offering of the securities		814,425
Total		10,500,000

Item 32. Sales to Special Parties

None.

Item 33. Recent Sales of Unregistered Securities

On November 8, 2019, the Company launched a best-efforts private placement offering exempt from registration pursuant to Rule 506(b) of Regulation D of the Securities Act pursuant to which it is offering a maximum of $50,000,000 in shares of its Series 2019 Preferred Stock to accredited investors (the “Private Offering”) at a purchase price of $10.00 per share (with discounts available to certain categories of purchasers). The exemption is available to the Company because the shares are being offered and sold solely to accredited investors without the use of general solicitation. In connection with the launch of the Private Offering, on November 8, 2019, the Company entered a managing broker dealer agreement (the “Managing Broker Dealer Agreement”) with an unaffiliated third party to act as the managing broker dealer for the Private Offering.

Through April 10, 2020, the Company has issued and sold 965,894 shares of its Series 2019 Preferred Stock in the Private Offering and received aggregate proceeds of $9,621,279. In connection with the sale of these shares in the Private Offering, the Company paid aggregate selling commissions of $632,689 and placement fees of $188,204.

Item 34. Indemnification of Directors and Officers

Subject to the significant conditions set forth below, the Company has included in its charter a provision limiting the liability of its directors and officers to the Company and its stockholders for money damages except for liability resulting from (a) actual receipt of an improper benefit or profit in money, property or services or (b) active and deliberate dishonesty established by a final judgment as being material to the cause of action.

Subject to the significant conditions set forth below, the charter also provides that the Company shall indemnify a director, officer or the Advisor or any of its affiliates against any and all losses or liabilities reasonably incurred by them (other than when sued by or in right of the Company) in connection with or by reason of any act or omission performed or omitted to be performed on behalf of the Company in such capacity.

Under the Company’s charter, the Company shall not indemnify a director, the Advisor or any of the Advisor’s affiliates (each an “Indemnitee”) for any liability or loss suffered by an Indemnitee, nor shall it exculpate an Indemnitee, unless all of the following conditions are met: (i) an Indemnitee has determined, in good faith, that the course of conduct that caused the loss or liability was in the best interests of the Company; (ii) the Indemnitee was acting on behalf of or performing services for the Company; (iii) such liability or loss was not the result of (A) negligence or misconduct by the Indemnitee, excluding an independent

director, or (B) gross negligence or willful misconduct by an independent director; and (iv) such indemnification or agreement to hold harmless is recoverable only out of the Company’s net assets and not from its stockholders. Notwithstanding the foregoing, an Indemnitee shall not be indemnified by the Company for any losses, liability or expenses arising from or out of an alleged violation of federal or state securities laws by such party unless one or more of the following conditions are met: (i) there has been a successful adjudication on the merits of each count involving alleged securities law violations as to the particular Indemnitee; (ii) such claims have been dismissed with prejudice on the merits by a court of competent jurisdiction as to the particular Indemnitee; and (iii) a court of competent jurisdiction approves a settlement of the claims against a particular Indemnitee and finds that indemnification of the settlement and the related costs should be made, and the court considering the request for indemnification has been advised of the position of the Securities and Exchange Commission (“SEC”) and of the published position of any state securities regulatory authority in which securities of the Company were offered or sold as to indemnification for violations of securities laws.

The charter provides that the advancement of Company funds to an Indemnitee for legal expenses and other costs incurred as a result of any legal action for which indemnification is being sought is permissible only if (in addition to the procedures required by Maryland law) all of the following conditions are satisfied: (i) the legal action relates to acts or omissions with respect to the performance of duties or services on behalf of the Company; (ii) the legal action is initiated by a third party who is not a common stockholder or the legal action is initiated by a common stockholder acting in his or her capacity as such and a court of competent jurisdiction specifically approves such advancement; and (iii) the Indemnitee undertakes to repay the advanced funds to the Company, together with the applicable legal rate of interest thereon, if the Indemnitee is found not to be entitled to indemnification.

It is the position of the SEC that indemnification of directors and officers for liabilities arising under the Securities Act is against public policy and is unenforceable pursuant to Section 14 of the Securities Act.

The Company will also purchase and maintain insurance on behalf of all of its directors and executive officers against liability asserted against or incurred by them in their official capacities with the Company, whether or not the Company is required or has the power to indemnify them against the same liability.

Item 35. Treatment of Proceeds from Stock Being Registered

Not applicable.

Item 36. Financial Statements and Exhibits

(a) Financial Statements. The following financial statements are filed as part of this registration statement:

• The consolidated financial statements of the Company and the notes thereto as of and for the year ended December 31, 2019 (included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 filed with the SEC on March 29, 2019 and incorporated herein by reference);

• The financial statements of Cottonwood West Palm and the related pro forma financial statements of the Company (included in the Company’s Current Report on Form 8-K/A filed with the SEC on August 1, 2019 and incorporated herein by reference); and

• Prior performance tables (unaudited) as of the year ended December 31, 2019 (included in supplement no. 7).

(b) Exhibits. The following exhibits are filed as part of this registration statement:

Ex.	Description
1.1	Dealer Manager Agreement by and among the Company, Cottonwood Communities Management, LLC and Orchard Securities, LLC dated August  13, 2018 (incorporated by reference to Exhibit 10.4 on Form 10-Q (No. 333-215272) filed September 26, 2018)
1.2	Amendment No.  1 to Dealer Manager Agreement by and among the Company, Cottonwood Communities Management, LLC and Orchard Securities, LLC dated March 18, 2019 (incorporated by reference to Exhibit 1.2 to Post-Effective Amendment No.  2 to the Company’s Registration Statement on Form S-11 (No. 333-215272) filed May 3, 2019)
1.3	Amended and Restated Dealer Manager Agreement (including the Form of Selected Dealer Agreement), by and among the Company, CC Advisors III, LLC and Orchard Securities, LLC, dated October 15, 2019 (incorporated by reference to Exhibit 1.1 to the Company’s Current Report on Form 8-K filed October 16, 2019)
1.4	Second Amended and Restated Dealer Manager Agreement (including the Form of Selected Dealer Agreement), by and among the Company, CC Advisors III, LLC and Orchard Securities, LLC, dated February  20, 2020*
3.1	Articles of Amendment and Restatement (incorporated by reference to Exhibit 3.1 to Pre-Effective Amendment No. 3 to the Company’s Registration Statement on Form S-11 (No. 333-215272) filed June 27, 2018)

3.2	Bylaws (incorporated by reference to Exhibit 3.2 to the Company’s Registration Statement on Form S-11  (No. 333-215272) filed December 22, 2016)
3.3	Articles Supplementary for the Class A shares of common stock (incorporated by reference to Exhibit 3.1 on Form 8-K (No. 333-215272) filed August 19, 2019)
3.4	Articles Supplementary for the Class T shares of common stock (incorporated by reference to Exhibit 3.2 on Form 8-K (No. 333-215272) filed August 19, 2019)
3.5	Articles of Amendment (incorporated by reference to Exhibit 3.3 on Form 8-K (No. 333-215272) filed August 19, 2019)
3.6	Article Supplementary – Preferred Stock (incorporated by reference to Exhibit 3.6 to the Company’s Quarterly Report on Form 10-Q filed November 13, 2019)
4.1	Form of Subscription Agreement (incorporated by reference to Appendix A to the prospectus)
4.2	Statement regarding restrictions on transferability of shares of common stock (to appear on stock certificate or to be sent upon request and without charge to stockholders issued shares without certificates) (incorporated by reference to Exhibit 4.2 to Pre-Effective Amendment No. 3 to the Company’s Registration Statement on Form S-11 (No. 333-215272) filed June 27, 2018)
4.3	Amended and Restated Distribution Reinvestment Plan (incorporated by reference to Appendix B to the prospectus)
5.1	Opinion of DLA Piper LLP (US) re: legality (incorporated by reference to Exhibit 5.1 to Post-Effective Amendment No.  3 to the Company’s Registration Statement on Form S-11 (No. 333-215272) filed August 6, 2019)
8.1	Opinion of DLA Piper LLP (US) re: tax matters (incorporated by reference to Exhibit 8.1 to Post-Effective Amendment No.  3 to the Company’s Registration Statement on Form S-11 (No. 333-215272) filed August 6, 2019)
10.1	Advisory Agreement among Cottonwood Communities, Inc. and Cottonwood Communities O.P., LP and CC Advisors III, LLC dated August 13, 2019 (incorporated by reference to the Company’s Quarterly Report on Form 10-Q filed November 13, 2019)
10.2	Managing Broker-Dealer Agreement (incorporated by reference to Exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q filed November 13, 2019)
10.3	Amended and Restated Three-Party Agreement, by and among the Company, Cottonwood Communities O.P., LP and CC Advisors III, LLC, dated October 14, 2019 (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed October 16, 2019)
10.4	Three-Party Agreement (Property Management) by and among the Company, Cottonwood Communities O.P., LP and Cottonwood Communities Management, LLC dated March 1, 2019 (incorporated by reference to Exhibit 10.2 to Post-Effective Amendment No. 2 to the Company’s Registration Statement on Form S-11 (No. 333-215272) filed May 3, 2019)
10.5	Amended and Restated Agreement of Limited Partnership of Cottonwood Communities O.P., LP dated February 1, 2020*
10.6	Assignment of Promotional Interest by and among Cottonwood Residential O.P., LP, Cottonwood Communities Investor, LLC and Cottonwood Communities Advisors Promote, LLC dated March 1, 2019 (incorporated by reference to Exhibit 10.8 to Post-Effective Amendment No. 2 to the Company’s Registration Statement on Form S-11 (No. 333-215272) filed May 3, 2019)
10.7	Master Credit Facility Agreement by and between CC West Palm, LLC and Berkadia Commercial Mortgage, LLC dated May  30, 2019 (incorporated by reference to Exhibit 10.5 on Form 8-K (No. 333-215272) filed June 4, 2019)

10.8	Consolidated, Amended and Restated Multifamily Note by and between CC West Palm, LLC and Berkadia Commercial Mortgage, LLC dated May 30, 2019 (incorporated by reference to Exhibit 10.6 on Form 8-K (No. 333-215272) filed June 4, 2019)
10.9	Property Management Agreement (Luma) between CC West Palm, LLC and Cottonwood Communities Management, LLC effective as of May 30, 2019 (incorporated by reference to Exhibit 10.14 on Form 10-K (No. 333-215272) filed March 25, 2020)
10.10	Member Interest Purchase and Sale Agreement (One Upland) between KRE JAG One Upland Venture LLC and CC One Upland, LLC dated January 3, 2020*
10.11	First Amendment to Member Interest Purchase and Sale Agreement (One Upland) between KRE JAG One Upland Venture LLC and CC One Upland, LLC dated January 24, 2020*
10.12	Second Amendment to Member Interest Purchase and Sale Agreement (One Upland) between KRE JAG One Upland Venture LLC and CC One Upland, LLC dated January 30, 2020*
10.13	Third Amendment to Member Interest Purchase and Sale Agreement (One Upland) between KRE JAG One Upland Venture LLC and CC One Upland, LLC dated February 7, 2020*
10.14	Fourth Amendment to Member Interest Purchase and Sale Agreement (One Upland) between KRE JAG One Upland Venture LLC and CC One Upland, LLC dated February 14, 2020*
10.15	Fifth Amendment to Member Interest Purchase and Sale Agreement (One Upland) between KRE JAG One Upland Venture LLC and CC One Upland, LLC dated February 18, 2020*
10.16	Revolving Loan and Security Agreement (One Upland) between KRE JAG One Upload Owner LLC and JPMorgan Chase Bank, N.A. dated March 19, 2020*
10.17	Promissory Note between KRE JAG One Upland Owner LLC amd JPMorgan Chase Bank, N.A. dated March 19, 2020*
10.18	Property Management Agreement between KRE JAG One Upland Owner LLC and Cottonwood Communities Management, LLC dated March 19, 2020*
10.19	Form of Performance-Based LTIP Unit Award Agreement*
10.20	Form of Time-Based LTIP Unit Award Agreement*
21.1	Subsidiaries of the Company (incorporated by reference to Exhibit 21.1 on Form 10-K (No. 333-215272) filed March 25, 2020)
23.1	Consent of DLA Piper LLP (US) (included in Exhibits 5.1 and 8.1 )
23.3	Consent of KPMG, LLP*
23.4	Consent of WSRP, LLC*
24.1	Power of Attorney of Daniel Shaeffer, Susan Hallenberg and Gregg Christensen (incorporated by reference to the signature page of the Company’s Registration Statement on Form S-11 (No. 333-215272) filed December 22, 2016)
24.2	Power of Attorney for Chad Christensen (incorporated by reference to the signature page of Pre-Effective Amendment No. 1 to the Company’s Registration Statement on Form S-11 (No. 333-215272) filed March 27, 2018)
24.3	Power of Attorney of Brent Hardy, Gentry Jensen and John Lunt (included on the signature page of Pre-Effective Amendment No. 3 to the Company’s Registration Statement filing on Form S-11 (No. 333-215272) filed June 27, 2018)
24.4	Power of Attorney for Adam Larson (incorporated by reference to Exhibit 24.4 of the Company’s Post-Effective Amendment No.  1 to the Company’s Registration Statement on Form S-11 (No. 333-215272) filed April 2, 2019)
24.5	Power of Attorney for Enzio Cassinis (incorporated by reference to Exhibit 24.5 of the Company’s Post-Effective Amendment No.  1 to the Company’s Registration Statement on Form S-11 (No. 333-215272) filed April 2, 2019)
24.6	Power of Attorney for Chad Christensen (incorporated by reference to Exhibit 24.6 of the Company’s Post-Effective Amendment No. 1 to the Company’s Registration Statement on Form S-11 (No. 333-215272) filed April 2, 2019)
24.7	Power of Attorney for Daniel Shaeffer (incorporated by reference to Exhibit 24.7 of the Company’s Post-Effective Amendment No. 1 to the Company’s Registration Statement on Form S-11 (No. 333-215272) filed April 2, 2019)

24.8	Power of Attorney for R. Brent Hardy (incorporated by reference to Exhibit 24.8 of the Company’s Post-Effective Amendment No.  1 to the Company’s Registration Statement on Form S-11 (No. 333-215272) filed April 2, 2019)
24.9	Power of Attorney for Gentry Jensen (incorporated by reference to Exhibit 24.9 of the Company’s Post-Effective Amendment No.  1 to the Company’s Registration Statement on Form S-11 (No. 333-215272) filed April 2, 2019)
24.10	Power of Attorney for John Lunt (incorporated by reference to Exhibit 24.10 of the Company’s Post-Effective Amendment No.  1 to the Company’s Registration Statement on Form S-11 (No. 333-215272) filed April 2, 2019)
24.11	Power of Attorney for Susan Hallenberg (incorporated by reference to Exhibit 24.11 of the Company’s Post-Effective Amendment No. 1 to the Company’s Registration Statement on Form S-11 (No. 333-215272) filed April 2, 2019)
99.1	Share Repurchase Program (incorporated by reference to Exhibit 99.1 to Pre-Effective Amendment No.  2 to the Company’s Registration Statement on Form S-11 (No. 333-215272) filed May 22, 2018)

* Exhibits filed herein.

Item 37. Undertakings

(a) The Company undertakes to file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement (i) to include any prospectus required by Section 10(a)(3) of the Securities Act; (ii) to reflect in the prospectus any facts or events arising after the effective date of this Registration Statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the Registration Statement; notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the SEC pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and (iii) to include any material information with respect to the plan of distribution not previously disclosed in the Registration Statement or any material change to such information in the Registration Statement.

(b) The Company undertakes (i) that, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new Registration Statement relating to the securities offered therein and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof, (ii) to remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

(c) The Company undertakes that, for the purpose of determining liability under the Securities Act to any purchaser, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness; provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.

(d) For the purpose of determining liability of the Company under the Securities Act to any purchaser in the initial distribution of the securities, the Company undertakes that in a primary offering of securities pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the Company will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser: (i) any preliminary prospectus or prospectus of the Company relating to the offering required to be filed pursuant to Rule 424, (ii) any free writing prospectus relating to the offering prepared by or on behalf of the Company or used or referred to by the Company, (iii) the portion of any other free writing prospectus relating to the offering containing material information about the Company or its securities provided by or on behalf of the Company, and (iv) any other communication that is an offer in the offering made by the Company to the purchaser.

(e) The Company undertakes to send to each stockholder, at least on an annual basis, a detailed statement of any transaction with the Advisor or its affiliates, and of fees, commissions, compensation and other benefits paid or accrued to the Advisor or its affiliates for the fiscal year completed, showing the amount paid or accrued to each recipient and the services performed.

(f) The Company undertakes to file a sticker supplement pursuant to Rule 424(c) under the Securities Act during the distribution period describing each significant property not identified in the prospectus at such time as there arises a reasonable probability that such property will be acquired and to consolidate all such stickers into a post-effective amendment filed at least once every three months with the information contained in such amendment provided simultaneously to the existing stockholders. Each sticker supplement will disclose all compensation and fees received by the Advisor and its affiliates in connection with any such acquisition. The post-effective amendment shall include or incorporate by reference audited financial statements meeting the requirements of Rule 3-14 of Regulation S-X that have been filed or should have been filed on Form 8-K for all significant properties acquired during the distribution period.

(g) The Company undertakes to file, after the distribution period, a current report on Form 8-K containing the financial statements and any additional information required by Rule 3-14 of Regulation S-X, for each significant property acquired and to provide the information contained in such report to the stockholders at least once each quarter after the distribution period of the offering has ended.

(h) The Company undertakes to provide to the stockholders the financial statements required by Form 10-K for the first full fiscal year of operations.

(i) Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Company pursuant to the foregoing provisions, or otherwise, the Company has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Company of expenses incurred or paid by a director, officer or controlling person of the Company in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Company will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

(j) The Company undertakes to provide to the dealer manager at the closings specified in the dealer manager agreement the following: (i) if the securities are certificated, certificates in such denominations and registered in such names as required by the dealer manager to permit prompt delivery to each purchaser or (ii) if the securities are not certificated, a written statement of the information required on certificates that is required to be delivered to stockholders to permit prompt delivery to each purchaser.

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-11 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Salt Lake City, State of Utah, on the 17th day of April, 2020.

COTTONWOOD COMMUNITIES, INC.

/s/ Adam Larson

Adam Larson, Chief Financial Officer

(Principal Financial Officer)

Pursuant to the requirements of the Securities Act of 1933, as amended, this registration statement has been signed by the following persons in the capacities and on the dates indicated:

Name	Date
* Enzio Cassinis, Chief Executive Officer and President (Principal Executive Officer)	April 17, 2020
/s/ Adam Larson Adam Larson, Chief Financial Officer (Principal Financial Officer)	April 17, 2020
* Susan Hallenberg, Chief Accounting Officer and Treasurer (Principal Accounting Officer)	April 17, 2020
* Daniel Shaeffer, Chairman of the Board and Director	April 17, 2020
* Chad Christensen, Director	April 17, 2020
* R. Brent Hardy, Independent Director	April 17, 2020
* Gentry Jensen, Independent Director	April 17, 2020
* John Lunt, Independent Director	April 17, 2020

* By:	/s/ Adam Larson
	Adam Larson, Chief Financial Officer Attorney-in-fact

EX-1.4

Exhibit 1.4

SECOND AMENDED AND RESTATED DEALER MANAGER AGREEMENT

COTTONWOOD COMMUNITIES, INC.

6340 South 3000 East, Suite 500

Salt Lake City, Utah 84121

February 20, 2020

Orchard Securities, LLC

365 Garden Grove Lane, Suite 100

Pleasant Grove, Utah 84062

Re:    Dealer Manager Agreement

Ladies and Gentlemen:

This Second Amended and Restated Dealer Manager Agreement (this “Agreement”) amends, restates and replaces in full, effective as of the date hereof, that certain Amended and Restated Dealer Manager Agreement dated October 15, 2019 between Cottonwood Communities, Inc., a Maryland corporation (the “Company”), CC Advisors III, LLC (the “Advisor”) and Orchard Securities, LLC (the “Dealer Manager”). This Agreement confirms and comprises the agreement among the Company, the Advisor and the Dealer Manager regarding the offering and sale to the public (the “Offering”) by the Company of up to $750,000,000 in Class A shares and Class T shares of common stock of the Company (the “Shares”), pursuant to a primary offering (the “Primary Offering”) and the Company’s distribution reinvestment plan (the “DRP”). For the avoidance of doubt, nothing in this Agreement shall modify or terminate any obligations or duties of the parties to the Dealer Manager Agreement dated August 13, 2018 between the Company, Cottonwood Communities Management, LLC, a Delaware limited liability company, and the Dealer Manager, as amended by the First Amendment to Dealer Manager Agreement, dated as of March 1, 2019 (as amended, the “Original Dealer Manager Agreement”) contained in the Original Dealer Manager Agreement with respect to the performance of such agreement through October 15, 2019, which obligations shall remain in full force and effect pursuant to the terms of the Original Dealer Manager Agreement.

1.    Appointment of the Dealer Manager.

1.1    On the basis of the representations, warranties and covenants herein contained, but subject to the terms and conditions herein set forth, the Dealer Manager is hereby appointed and agrees to sell the Shares in the Offering on an “best-efforts” basis during the Offering Period (as defined in Section 1.2 below). The Dealer Manager is authorized to enlist other members of the Financial Industry Regulatory Authority, Inc. (“FINRA”) acceptable to the Company (the “Selling Group Members”) to sell the Shares.

1.2    It is understood that no sale of the Shares shall be regarded as effective unless and until accepted by the Company. The Company reserves the right in its sole discretion to accept or reject any subscription for the Shares in whole or in part. Subscriptions will be submitted by Dealer Manager and each Selling Group Member to the Company on a subscription agreement in the form filed as an appendix to the Prospectus (“Subscription Agreement”). The Company shall have a period of 30 days after receipt of the Subscription Agreement to accept or reject the Subscription Agreement. Any proposed subscription for the Shares not accepted within such 30 day period shall be deemed rejected. The “Offering Period” shall mean that period during which Shares may be offered for sale, commencing

on the Effective Date of the Registration Statement (defined in Section 2.2 below) (but in no event prior to the Effective Date of the Registration Statement), during which period offers and sales of the Shares shall occur continuously in the jurisdictions in which the Shares are registered or qualified or exempt from registration (as confirmed in writing by the Company to the Dealer Manager) unless and until the Offering is terminated, provided that the Dealer Manager and the Selling Group Members will suspend or terminate offering Shares upon request of the Company at any time and will resume offering Shares upon subsequent request of the Company. The Offering Period shall in all events terminate upon the sale of all of the Shares. Upon termination of the Offering Period, the Dealer Manager’s agency and this Agreement shall terminate without obligation on the part of the Dealer Manager or the Company except as set forth in this Agreement.

1.3     Subject to the performance by the Company of all the obligations to be performed hereunder, and to the completeness and accuracy of all the representations and warranties contained herein, the Dealer Manager hereby accepts such agency and agrees on the terms and conditions herein set forth to use its best efforts during the Offering Period to find subscribers that meet the financial qualification and suitability standards set forth in the Prospectus as amended and supplemented (the “Subscribers”) for the Shares.

1.4    The Shares will be offered at the prices set forth in the Prospectus. The Advisor will pay all amounts due to the Dealer Manager pursuant to Section 7 of this Agreement and will be obligated to pay all organization and offering expenses of the Company in connection with the Offering.

2.    Representations and Warranties of the Company. The Company hereby represents and warrants to the Dealer Manager that:

2.1    The Company has been duly organized and is validly existing as a corporation in good standing under the laws of the State of Maryland, has all requisite power and authority to enter into this Agreement and has all requisite power and authority to conduct its business as described in the Prospectus.

2.2    The Company has prepared and filed with the Securities and Exchange Commission (the “SEC”) a registration statement (Registration No. 333-215272) that has become effective for the registration of the Shares under the Securities Act of 1933, as amended (the “Securities Act”), and the applicable rules and regulations of the SEC promulgated thereunder. Copies of such registration statement as initially filed and each amendment thereto have been or will be delivered to the Dealer Manager. The registration statement and the prospectus contained therein, as finally amended at the effective date of the registration statement (the “Effective Date”), are respectively hereinafter referred to as the “Registration Statement” and the “Prospectus,” except that if the Company files a prospectus or prospectus supplement pursuant to Rule 424(b) under the Securities Act, or if the Company files a post-effective amendment to the Registration Statement, the term “Prospectus” includes the prospectus filed pursuant to Rule 424(b) or the prospectus included in such post-effective amendment. The term “Preliminary Prospectus” as used herein shall mean a preliminary prospectus related to the Shares as contemplated by Rule 430 or Rule 430A of the rules and regulations of the SEC promulgated under the Securities Act included at any time as part of the registration statement. If one or more additional registration statements are filed by the Company and become effective with respect to shares of the Company’s common stock to be sold pursuant to the DRP, the terms “Registration Statement” and “Prospectus” shall refer, with respect to such DRP shares, to each such registration statement and prospectus contained therein from and after the date of effectiveness of each such registration statement, as each such registration statement and prospectus may be amended or supplemented from time to time.

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2.3    No defaults exist in the due performance or observance of any material obligation, term, covenant or condition of any agreement or instrument to which the Company is a party or by which it is bound.

2.4    On the Effective Date, the Registration Statement did not or will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. On the date of the Prospectus, as amended or supplemented, as applicable, the Prospectus did not or will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. Notwithstanding anything contained herein to the contrary, the Company’s representations in this Section 2.4 will not extend to such statements contained in or omitted from the Registration Statement or the Prospectus, as amended or supplemented, that are primarily within the knowledge of the Dealer Manager or any of the Selling Group Members and are based upon information furnished by the Dealer Manager in writing to the Company specifically for inclusion therein.

2.5    No consent, approval, authorization or other order of any governmental authority is required in connection with the execution or delivery by the Company of this Agreement or the issuance and sale by the Company of the Shares, except such as may be required under the Securities Act and the rules and regulations promulgated thereunder, FINRA or applicable state securities laws.

2.6    At the time of the issuance of the Shares, the Shares will have been duly authorized and, when issued and sold as contemplated by the Prospectus and the Company’s charter, as amended and supplemented, and upon payment therefor as provided in the Prospectus and this Agreement, will be validly issued, fully paid and nonassessable and will conform to the description thereof contained in the Prospectus.

2.7    The Company intends to apply the net proceeds from the Offering received by it in the manner set forth in the Prospectus.

The representations and warranties made in this Section 2 are and shall be continuing representations and warranties throughout the term of the Offering. In the event that any of these representations or warranties become untrue, the Company will immediately notify the Dealer Manager in writing of the fact which makes the representation or warranty untrue.

3.    Covenants of the Company. The Company agrees that:

3.1    The Company will deliver to the Dealer Manager such numbers of copies of the Registration Statement and Prospectus, with all amendments, supplements and exhibits thereto, as the Dealer Manager may reasonably request for the purposes contemplated by federal and applicable state securities laws. The Company also will deliver to the Dealer Manager such number of copies of any printed sales literature or other materials authorized by the Company to be used in the Offering (“Authorized Sales Materials”) as the Dealer Manager may reasonably request in connection with the Offering.

3.2    Subject to the Dealer Manager’s actions and the actions of others in connection with the Offering, the Company will comply with all requirements imposed upon it by the Securities Act, the rules and regulations of the SEC promulgated thereunder, and by all applicable state securities laws and regulations of those states in which an exemption has been obtained or qualification of the Shares has been effected, including timely filing a Prospectus with such state securities regulators when required, to

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permit the continuance of offers and sales of the Shares, in accordance with the provisions of this Agreement and in the Prospectus, and will amend or supplement the Prospectus (including filing such amendment or supplement with the SEC) in order to make the Prospectus comply with the requirements of federal and applicable state securities laws and regulations.

3.3    If at any time when a Prospectus is required to be delivered under the Securities Act and the rules and regulations promulgated thereunder, any event occurs as a result of which the Prospectus would include an untrue statement of a material fact or, in view of the circumstances under which it was made, omit to state any material fact necessary to make the statements therein not misleading, the Company will notify the Dealer Manager thereof (unless the information shall have been received from the Dealer Manager), effect the preparation of an amended or supplemented Prospectus which will correct such statement or omission, and deliver to the Dealer Manager as many copies of such amended or supplemented Prospectus as the Dealer Manager may reasonably request.

3.4    Upon request, the Company will furnish to the Dealer Manager a copy of such papers filed by the Company in connection with any SEC qualification and/or state law blue sky filing.

3.5    The Company will: (i) file every amendment and supplement to the Registration Statement that may be required by the SEC and (ii) if at any time the SEC shall issue any stop order suspending the effectiveness of the Registration Statement, it will promptly notify the Dealer Manager.

3.6    The Company will disclose a per share estimated value of the Shares and related information in accordance with the applicable requirements of FINRA Rule 2310(b)(5). The Company will provide a copy of the forgoing information to the Dealer Manager simultaneously with the distribution of such information to the Shareholders.

4.    Duties and Obligations of the Dealer Manager.

4.1    The Dealer Manager will serve in a “best-efforts” capacity in the offering, sale and distribution of the Shares. The Dealer Manager may offer the Shares as an agent, but all sales shall be made by the Company, acting through the Dealer Manager as an agent, and not by the Dealer Manager as a principal. The Dealer Manager shall have no authority to appoint any person or other entity as an agent or sub-agent of the Dealer Manager or the Company, except to appoint Selling Group Members acceptable to the Company in its sole discretion. It is acknowledged that the Company may enter into selling agreements with non-commissioned registered investment advisors and, to the extent reasonably practicable, the Dealer Manager shall assist the Company and the registered investment advisors in completing any sales through the registered investment advisor.

4.2    The Dealer Manager shall not execute any transaction in which a Subscriber invests in the Shares in a discretionary account without prior written approval of the transaction by the Subscriber.

4.3    The Dealer Manager will comply in all respects with the subscription procedures and plan of distribution set forth in the Prospectus.

4.4    The Dealer Manager shall complete all steps necessary to permit the Dealer Manager to perform its obligations under this Agreement pursuant to exemptions available under applicable federal law and applicable state laws. The Dealer Manager shall conduct all of its solicitation and sales efforts in conformity with applicable federal and state securities laws.

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4.5    The Dealer Manager will immediately bring to the attention of the Company any circumstance or fact which causes the Dealer Manager to believe the Registration Statement, or any other Authorized Sales Materials distributed pursuant to the Offering, or any information supplied by prospective Subscribers in their subscription materials, may be inaccurate or misleading.

4.6    The Dealer Manager will terminate the Offering upon request of the Company at any time.

4.7    The Dealer Manager shall enter into a Soliciting Dealer Agreement substantially in the form attached hereto as Exhibit A with each Selling Group Member, and shall not materially modify, amend or supplement the terms of the Soliciting Dealer Agreement without the prior written consent of the Company.

4.8    The Dealer Manager is required to provide, or require the Selling Group Member to provide, each prospective Investor with a copy of the final Prospectus and any exhibits and appendices thereto.

4.9    The Dealer Manager shall submit to FINRA (no later than one business day after filing with or submitting to the SEC or any state securities commission or other regulatory authority) a copy of the documents to be filed pursuant to FINRA Rule 5110(b)(5) and the information specified in FINRA Rule 5110(b)(6); provided, however, any documents that are filed with the SEC through the SEC’s EDGAR System that are referenced in FINRA’s electronic filing system shall be treated as filed with FINRA, and provided, further, that the Company will provide a copy of any such documents to you in advance of its public distribution. No sales of Shares shall commence unless such documents and information have been filed with and reviewed by FINRA and FINRA has provided an opinion that it has no objections to the proposed underwriting and other terms and arrangements.

4.10    To the extent the Dealer Manager retains any offering documents or Subscription Agreements in electronic form, the Dealer Manager will store such electronic offering documents and Subscription Agreements in a non-rewriteable and non-erasable format.

4.11    The Dealer Manager will take prompt action in the event of a security breach to (i) identify and locate the breach, (ii) secure the affected information, (iii) suspend the use of the particular device or technology that has been compromised until information security has been restored and (iv) provide notice of the security breach to any investor whose confidential personal information has been improperly accessed in connection with the security breach. Compliance with this item after the discovery of a security breach or any other breach of personal information shall not substitute or in any way affect other requirements or obligations, including notification, imposed on the Dealer Manager pursuant to applicable laws, regulations, or standards.

5.    Representations and Warranties of the Dealer Manager. The Dealer Manager represents and warrants to the Company that:

5.1    The Dealer Manager is a duly organized Utah limited liability company.

5.2    This Agreement, when executed by the Dealer Manager, will have been duly authorized and will be a valid and binding agreement of the Dealer Manager, enforceable in accordance with its terms.

5.3    The consummation of the transactions contemplated herein and those contemplated by the Prospectus will not result in a breach or violation of any order, rule or regulation directed to the Dealer Manager by any court or any federal or state regulatory body or administrative agency having jurisdiction over the Dealer Manager or its affiliates.

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5.4    The Dealer Manager is, and during the term of this Agreement will be, duly registered as a broker-dealer pursuant to the provisions of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), a member in good standing of FINRA, and a broker or dealer duly registered as such in any state where offers are made by the Dealer Manager. The Dealer Manager will comply with all applicable laws, regulations and requirements of the Securities Act, the Exchange Act, applicable state law and FINRA. The Dealer Manager and its employees and representatives involved in this Offering have all required licenses, registrations and permits.

5.5    The Dealer Manager has reasonable grounds to believe, based on information made available to it by the Company, that all material facts are adequately and accurately disclosed in the Prospectus and provide an adequate basis for evaluating an investment in the Shares.

5.6    This Agreement, or any supplement or amendment hereto, may be filed by the Company with the SEC, and may be filed with, and may be subject to the approval of, any applicable federal and applicable state securities regulatory agencies, if required.

5.7    No agreement will be made by the Dealer Manager with any person permitting the resale, repurchase or distribution of the Shares purchased by such person.

5.8    The Dealer Manager’s acceptance of this Agreement constitutes a representation to the Company that the Dealer Manager has established and implemented anti-money-laundering compliance programs, in accordance with FINRA Rule 3310 and Section 352 of the Money Laundering Abatement Act and Section 326 of the Patriot Act of 2001, which are reasonably expected to detect and cause reporting of suspicious transactions in connection with the sale of the Shares.

5.9    In the event the Dealer Manager becomes a Selling Group Member, the Dealer Manager shall comply with all requirements of the Selling Group Members as set forth in the Soliciting Dealer Agreement.

5.10    The Dealer Manager represents and warrants to the Company and each person that signs the Registration Statement that all information furnished or to be furnished to the Company by the Dealer Manager in writing expressly for use in the Registration Statement, any Preliminary Prospectus or the Prospectus, does not and will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading.

The representations and warranties made in this Section 5 are and shall be continuing representations and warranties throughout the term of the Offering. In the event that any of these representations or warranties become untrue, the Dealer Manager will immediately notify the Company in writing of the fact which makes the representation or warranty untrue.

6.    Covenants of the Dealer Manager.

6.1    In connection with the Dealer Manager’s participation in the offer and sale of Shares (including, without limitation, any resales and transfers of Shares), the Dealer Manager will comply, and in its agreements with Selling Group Members will require that the Selling Group Members comply, with all requirements and obligations imposed upon any of them by (a) the Securities Act, the Exchange Act and the rules and regulations of the SEC promulgated under both such acts, including the obligation to deliver a copy of the Prospectus as amended or supplemented; (b) all applicable state

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securities laws and regulations as from time to time in effect; (c) the applicable rules of FINRA, including, but not in any way limited to, FINRA Rule 2121, FINRA Rule 2310 and FINRA Rule 5141; (d) all applicable rules and regulations relating to the suitability of the investors, including, without limitation, the provisions of Articles III.C and III.E of the Statement of Policy regarding Real Estate Investment Trusts of the North American Securities Administrators Association, Inc. (“NASAA Guidelines”); (e) any other state and federal laws and regulations applicable to the Offering, the sale of Shares or the activities of the Dealer Manager pursuant to this Agreement; and (f) this Agreement and the Prospectus as amended and supplemented.

6.2    The Dealer Manager will not offer the Shares, and in its agreements with Selling Group Members will require that the Selling Group Members not offer Shares, in any jurisdiction unless and until (a) the Dealer Manager has been advised by the Company in writing that the Shares are either registered in accordance with, or exempt from, the securities laws of such jurisdiction and (b) the Dealer Manager and any Selling Group Member offering Shares in such jurisdiction have all required licenses and registrations to offer Shares in that jurisdiction.

6.3    The Dealer Manager will make, and in its agreements with Selling Group Members will require that Selling Group Members make, no representations concerning the Offering except as set forth in the Prospectus as amended and supplemented and in the Authorized Sales Materials.

6.4    The Dealer Manager will offer Shares, and in its agreements with Selling Group Members will require that the Selling Group Members offer Shares, only to persons who meet the financial qualification and suitability standards set forth in the Prospectus as amended and supplemented or in any suitability letter or memorandum sent to the Dealer Manager by the Company. The Dealer Manager shall maintain, or in its agreements with Selling Group Members shall require the Selling Group Members to maintain, for at least six years following the termination of the Offering, a record of the information obtained to determine that an investor meets the financial qualification and suitability standards imposed on the offer and sale of the Shares (both at the time of the initial subscription and at the time of any additional subscriptions, including initial enrollments and increased participations in the DRP).

6.5    Except for Authorized Sales Materials, the Company has not authorized the use of any supplemental literature or sales material in connection with the Offering and the Dealer Manager agrees not to use any such material that has not been authorized by the Company. The Dealer Manager further agrees (a) not to deliver any Authorized Sales Materials to any person unless it is accompanied or preceded by the Prospectus as amended and supplemented, (b) not to show or give to any investor or prospective investor or reproduce any material or writing that is supplied to it by the Company and marked “broker-dealer use only” or otherwise bearing a legend denoting that it is not to be used in connection with the sale of Shares to members of the public and (c) not to show or give to any investor or prospective investor in a particular jurisdiction any material or writing that is supplied to it by the Company if such material bears a legend denoting that it is not to be used in connection with the sale of Shares to members of the public in such jurisdiction.

6.6    The Dealer Manager will provide the Company with such information relating to the offer and sale of the Shares by it as the Company may from time to time reasonably request or as may be requested to enable the Company to prepare such reports of sale as may be required to be filed under applicable federal or state securities laws.

6.7    The Dealer Manager shall file all Authorized Sales Materials with FINRA, and shall provide written notice of (i) any comments on such Authorized Sales Materials provided by FINRA, and (ii) confirmation that FINRA has no objection to such Authorized Sales Materials.

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6.8    The Dealer Manager will permit a Selling Group Members to participate in the Offering only if such Selling Group Members is a member of FINRA.

7.    Compensation. Subject to the limitations in this section, Section 9 and as provided in the “Plan of Distribution” section of the Prospectus, as compensation for services rendered by the Dealer Manager under this Agreement, the Dealer Manager will be entitled to receive from the Advisor, as appropriate:

7.1    A selling commission up to 6.0% of the purchase price of the Class A shares sold by the Dealer Manager in the Primary Offering (“Class A Primary Sales”), and up to 3.0% of the purchase price of the Class T shares sold by the Dealer Manager in the Primary Offering (the “Class T Primary Sales” and, together with the Class A Primary Sales, the “Primary Sales”), which it will re-allow to the Selling Group Members; provided, however, that this amount will be reduced to the extent a lower commission rate is negotiated with a Selling Group Member and the commission rate will be the lower agreed upon rate.

7.2    A dealer manager fee in an amount up to 3.0% of the purchase price of the Primary Sales; provided, however, that this fee will be reduced to the extent a lower dealer manager fee is negotiated with a Selling Group Member, and, to the extent that other fees and expenses paid out of the dealer manager fee, as discussed below, are reduced from the maximum contemplated below, the dealer manager fee will be reduced to reflect the lower agreed upon amounts. From such dealer manager fee, the Dealer Manager will pay a wholesaler fee in an amount up to 1.35% of the purchase price of the Primary Sales, all of which will be re-allowed to certain wholesalers, some of which are internal to the Company and its affiliates. Further, from such dealer manager fee, the Dealer Manager will reallow 1.0% of the purchase price of the Primary Sales to the Selling Group Members as a non-accountable marketing and due diligence allowance (“Marketing Allowance”). Notwithstanding the foregoing, to the extent a Soliciting Dealer Agreement provides for a higher Marketing Allowance, such higher Marketing Allowance will be reallowed by the Dealer Manager to such Selling Group Member; provided, however, that the Marketing Allowance provided in any Selling Group Member’s Soliciting Dealer Agreement shall not exceed 1.25% of the purchase price of the Primary Sales by such Selling Group Member. Further notwithstanding the foregoing, if a Primary Sale is made by a registered investment advisor that is unaffiliated with a Selling Group Member, then no Marketing Allowance will be reallowed to any Selling Group Member and, in lieu of such Marketing Allowance, the Dealer Manager shall reallow 0.50% of the purchase price of such Primary Sales to certain wholesalers as directed by the Company, some of which are internal to the Company and its affiliates.

7.3    Subject to Section 7.4 below, a deferred selling commission with respect to Class T Primary Sales (the “Deferred Selling Commission”) equal to 1.0% per annum of the per share estimated value of the Class T Primary Sales. The Deferred Selling Commission will accrue daily based on the number of outstanding Class T Primary Sales. The Advisor will pay the Deferred Selling Commission to the Dealer Manager monthly in arrears. The Dealer Manager will reallow all of the Deferred Selling Commission to any Dealers who sold the Class T shares giving rise to a portion of such Deferred Selling Commission to the extent the Soliciting Dealer Agreement with such Dealer provides for such a reallowance; provided, however, that upon the date when the Dealer Manager is notified that the Dealer who sold the Class T shares giving rise to a portion of the Deferred Selling Commission is no longer the broker-dealer of record with respect to such Class T shares, then such Dealer’s entitlement to the portion of the Deferred Selling Commission related to such Class T shares shall cease, and beginning on such date, such portion of the Deferred Selling Commission may be reallowed by the Dealer Manager to the then-current broker-dealer of record of the Class T shares, if any such broker-dealer of record has been designated (the “Servicing Dealer”) to the extent such Servicing Dealer has entered into a Soliciting Dealer Agreement or similar agreement with the Dealer Manager (“Servicing Agreement”) and such Soliciting Dealer Agreement or Servicing Agreement with the Servicing Dealer provides for such reallowance. The Dealer Manager may also reallow some or all of the Deferred Selling

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Commission to other broker-dealers who provide services with respect to the Shares who shall be considered additional Servicing Dealers pursuant to a Servicing Agreement with the Dealer Manager to the extent such Servicing Agreement provides for such reallowance, all in accordance with the terms of such Servicing Agreement. Notwithstanding the foregoing, the Dealer Manager will rebate the Deferred Selling Commission with respect to sales of Class T shares to the Advisor to the extent a Dealer or Servicing Dealer is not eligible to receive such Deferred Selling Commission.

7.4    The Dealer Manager will cease receiving the Deferred Selling Commission with respect to individual Class T shares when they are no longer outstanding, including as a result of conversion to Class A shares and redemption and repurchase. Each Class T share held within a stockholder’s account shall automatically and without any action on the part of the holder thereof convert into a number of Class A shares at the conversion rate set forth in the Prospectus on the earliest of (a) a listing of the Class A shares on a national securities exchange, (b) the merger or consolidation of the Company with or into another entity, or the sale or other disposition of all or substantially all of the Company’s assets and (c) the last calendar day of the month in which the Company and the Dealer Manager, in conjunction with the Company’s transfer agent, determines that the total Deferred Selling Commissions paid with respect to the Class T shares held by such stockholder within such account equals or exceeds three percent of the aggregate purchase price of Class T shares held by such stockholder within such account and purchased in the primary offering (i.e., excluding Class T shares sold pursuant to the Company’s distribution reinvestment plan). In addition, after termination of the primary portion of the Offering, the Advisor will cease paying the Deferred Selling Commissions with respect to each Class T share sold in the primary portion of that Offering, on the date when, the Company, with the assistance of the Dealer Manager, determines that all underwriting compensation paid or incurred in connection with such Offering from all sources, determined pursuant to the rules and guidance of FINRA, would be in excess of 10% of the aggregate purchase price of all Primary Shares sold for the Company’s account in such Offering. Further, each such Class T share will automatically and without any action on the part of the holder thereof convert into a Class A share at the last calendar day of the month in which such determination is made.

7.5    The terms of any reallowance of selling commissions, dealer manager fees and the Deferred Selling Commission shall be set forth in the Soliciting Dealer Agreement or Servicing Agreement entered into with the Dealers or Servicing Dealers, as applicable.

7.6    The Dealer Manager may also sell the Shares as a Selling Group Member, thereby becoming entitled to selling commissions.

7.7    In addition to the other items of underwriting compensation set forth in this Section 7, the Advisor may pay directly or reimburse the Dealer Manager for the additional items of underwriting compensation referenced in the Prospectus to the extent the Prospectus indicates that they will be paid by the Advisor, and to the extent permitted pursuant to prevailing rules and regulations of FINRA.

No selling commissions, dealer manager fees or Deferred Selling Commissions shall be payable on Shares sold pursuant to the DRP. No Deferred Selling Commissions shall be payable on Class A shares.

Notwithstanding the above, if a sale of Class A shares has been made by a registered investment advisor, the Dealer Manager will only be entitled to receive the dealer manager fee set forth in Section 7.2 and shall not be entitled to receive the selling commissions described in Section 7.1 or 7.6, except as otherwise provided in the “Plan of Distribution” section of the Prospectus.

Notwithstanding anything herein to the contrary, in no event shall total aggregate underwriting compensation payable to the Dealer Manager and any Selling Group Members participating in the

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Offering, including but not limited to selling commissions, dealer manager fees and Deferred Selling Commissions, exceed ten percent (10.0%) of the gross proceeds raised from the sale of Shares in the Primary Offering in the aggregate.

The Dealer Manager acknowledges that the Company shall have no obligation, liability or responsibility whatsoever to pay any selling commissions, dealer manager fees, Deferred Selling Commissions, wholesaler fees, allowances, payments or amounts whatsoever in connection with the sale of Shares, either to the Dealer Manager or to the Selling Group Members. The Dealer Manager shall not bring any action, suit or other proceeding against the Company or any of its assets with respect to any such amounts in connection with the sale of Shares, including without limitation, any proceedings claiming nonpayment of such amounts by the Advisor. Further, the Advisor will not be liable or responsible to any Selling Group Member for direct payment of commissions, dealer manager fees, Deferred Selling Commissions, wholesaler fees, allowances or other payments to such Selling Group Member; it is the sole and exclusive responsibility of the Dealer Manager for payment of such amounts to Selling Group Members.

In addition, notwithstanding the foregoing provisions of this Section 7, the Company reserves the right, in its sole discretion, to refuse to accept any or all Subscription Agreements tendered by the Dealer Manager and/or to terminate the Offering of the Shares at any time.

8.    Offering. The Offering of the Shares shall be at the offering price and upon the terms and conditions set forth in the Prospectus (including any amendments or supplements thereto) and the exhibits and appendices thereto.

9.    Conditions to Payment of Commissions, Allowances and Expense Reimbursements; Timing of Payment.

9.1    No selling commissions, dealer manager fees, Deferred Selling Commissions, wholesaler fees, allowances or expense reimbursements or other compensation will be payable with respect to any Subscription Agreements that are rejected by the Company, or if the Company terminates the Offering for any reason whatsoever. No selling commissions, dealer manager fees, Deferred Selling Commissions, wholesaler fees, allowances, expense reimbursements or other compensation will be payable to the Dealer Manager with respect to any sale of the Shares by the Dealer Manager unless and until such time as the Company has received the total proceeds of any such sale and the Company has accepted the Subscription Agreement of such subscriber.

9.2    Except as provided in Section 17, all other expenses incurred by the Dealer Manager in the performance of the Dealer Manager’s obligations hereunder, including, but not limited to, expenses related to the Offering of the Shares and any attorneys’ fees, shall be at the Dealer Manager’s sole cost and expense, and the foregoing shall apply notwithstanding the fact that the Offering is not consummated for any reason.

9.3    Upon the satisfaction of the conditions to payment described in Section 9.1 above, the Advisor will pay the applicable selling commissions and dealer manager fees weekly with respect to the sale of Shares by the Dealer Manager which closed during the immediately preceding week. Dealer Manager shall provide prompt written notice to the Company of any lower selling commissions and dealer manager fees negotiated as described in Sections 7.1 and 7.2 herein, and Dealer Manager agrees to promptly return to the Advisor any selling commissions and dealer manager fees received by the Dealer Manager in excess of any applicable negotiated amounts.

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10.    Indemnification by the Company.

10.1    To the extent permitted by the Company’s charter and the provisions of Article II.G of the NASAA Guidelines, and subject to the conditions and limitations set forth below, the Company, with respect to the Offering, agrees to indemnify and hold harmless the Dealer Manager and the Selling Group Members and their respective officers, directors and each person, if any, who controls such person within the meaning of Section 15 of the Securities Act (collectively, the “DMSG Parties”) against any and all loss, liability, claim, damage and expense whatsoever (“Loss”) arising out of or based upon:

10.1.1    Any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or Prospectus (each as from time to time amended and supplemented), or in any blue sky application or other document executed by the Company and filed in any jurisdiction in order to qualify the Shares under or exempt the Offering of the Shares from the registration or qualification requirements of the securities laws thereof (“Blue Sky Application”) or Authorized Sales Materials, unless any of the DMSG Parties know such statement to be untrue;

10.1.2    The omission or alleged omission from the Registration Statement or Prospectus (each as from time to time amended and supplemented), any Blue Sky Application or Authorized Sales Materials of a material fact required to be stated therein or necessary to make the statements therein not misleading, unless any of the DMSG Parties know such statement to be untrue;

10.1.3    Any verbal or written representations made in connection with the Offering by the Company in violation of the Securities Act, or any other applicable federal or state securities laws and regulations; or

10.1.4    The breach by the Company of any term, condition, representation, warranty or covenant in this Agreement.

10.2    If any action is brought against any of the DMSG Parties in respect of which indemnity may be sought hereunder, the Dealer Manager or the Selling Group Members, as the case may be, shall promptly notify the Company in writing of the institution of such action, and the Company shall assume the defense of such action; provided, however, that the failure to notify the Company shall not affect the provisions in this Section 10 except to the extent such failure to notify the Company has a material and adverse effect on the defense of such claims. The affected DMSG Parties shall have the right to employ counsel in any such case. The reasonable fees and expenses of such counsel shall be at the Company’s expense and authorized in writing by the Company, provided that the Company will not be obligated to pay for legal fees and expenses for more than one law firm in connection with the defense of similar claims arising out of the same alleged acts or omissions.

10.3    The Company agrees to promptly notify the Dealer Manager of the commencement of any litigation or proceedings against the Company or any of its managers, members, partners, officers or employees in connection with the Offering.

10.4    The indemnity provided to the DMSG Parties pursuant to this Section 10 shall not apply to the extent that any Loss arises out of or is based upon any untrue statement or alleged untrue statement of material fact made by the Dealer Manager or Selling Group Member or any agent of the Dealer Manager or Selling Group Member, or any omission or alleged omission of a material fact required to be disclosed by the Dealer Manager or the Selling Group Member or any agent of the Dealer Manager or the Selling Group Member, and, further, shall not apply in any case if it is determined that the Dealer Manager or Selling Group Member was at fault in connection with the Loss.

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10.5    The foregoing indemnity provided to the DMSG Parties pursuant to this Section 10 is subject to the further condition that, insofar as it relates to any untrue statement, alleged untrue statement, omission or alleged omission made in the Prospectus (or amendment or supplement thereto) that was eliminated or remedied in any subsequent amendment or supplement thereto, such indemnity agreement shall not inure to the benefit of any DMSG Party from whom the person asserting any Losses purchased the Shares that are the subject thereof, if a copy of the Prospectus as so amended or supplemented was not sent or given to such person at or prior to the time the subscription of such person was accepted by the Company, but only if a copy of the Prospectus as so amended or supplemented had been supplied to the Dealer Manager or the Selling Group Member prior to such acceptance.

11.    Indemnification by the Dealer Manager.

11.1    Subject to the conditions set forth below, the Dealer Manager agrees to indemnify and hold harmless the Company, the Advisor and the Selling Group Members and their respective officers, directors (including any person named in the Registration Statement, with his or her consent, as about to become a director), each other person who has signed the Registration Statement, and each person, if any, who controls the Company, the Advisor or the Selling Group Members (collectively, the “CSGM Parties”), against any and all Loss arising out of or based upon:

11.1.1    Any verbal or written representations in connection with the Offering made by the Dealer Manager or its representatives in violation of the Securities Act or the rules and regulations promulgated thereunder, or any other applicable federal or state securities laws and regulations;

11.1.2    Any use of sales literature not authorized and approved by the Company, any use of “broker-dealer use only” materials with members of the public by the Dealer Manager in the offer and sale of Shares, or use of any sales literature in a particular jurisdiction if such material bears a legend denoting that it is not to be used in connection with the sale of Shares to members of the public in such jurisdiction;

11.1.3    The Dealer Manager’s failure to comply with any of the applicable provisions of the Securities Act, the Exchange Act, or the rules and regulations promulgated under both such acts, the applicable requirements and rules of FINRA, or any other applicable federal or state laws, rules or regulations; or

11.1.4    The breach by the Dealer Manager of any term, condition, representation, warranty, or covenant of this Agreement.

11.2    If any action is brought against the CSGM Parties in respect of which indemnity may be sought hereunder, the Company or the Selling Group Members shall promptly notify the Dealer Manager in writing of the institution of such action, and the Dealer Manager shall assume the defense of such action; provided, however, that the failure to notify the Dealer Manager shall not affect the provisions in this Section 11 except to the extent such failure to notify the Dealer Manager has a material and adverse effect on the defense of such claims. The affected CSGM Parties shall have the right to employ counsel in any such case. The reasonable fees and expenses of such counsel shall be at the Dealer Manager’s expense and authorized in writing by the Dealer Manager, provided that the Dealer Manager will not be obligated to pay for legal fees and expenses for more than one law firm in connection with the defense of similar claims arising out of the same alleged acts or omissions.

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11.3    The Dealer Manager agrees to promptly notify the Company of the commencement of any litigation or proceedings against the Dealer Manager or any of its managers, members, partners, officers or employees in connection with the Offering.

11.4    The indemnity provided to the Company and the Advisor pursuant to this Section 11 shall not apply to the extent that any Loss arises out of or is based upon any untrue statement or alleged untrue statement of material fact made by the Company or the Advisor or any agent of the Company (other than the Dealer Manager), or any omission or alleged omission of a material fact required to be disclosed by the Company or the Advisor or any agent of the Company or the Advisor (other than the Dealer Manager).

11.5    The indemnity provided to the Selling Group Member pursuant to this Section 11 shall not apply to the extent that any Loss arises out of or is based upon any untrue statement or alleged untrue statement of material fact made by the Selling Group Member or any agent of the Selling Group Member, or any omission or alleged omission of a material fact required to be disclosed by the Selling Group Member or any agent of the Selling Group Member.

12.    Indemnification by the Selling Group Member.

12.1    Subject to the conditions set forth below, each Selling Group Member agrees to indemnify and hold harmless the Company, the Advisor and the Dealer Manager and their respective officers, directors (including any person named in the Registration Statement, with his or her consent, as about to become a director), each other person who has signed the Registration Statement, and each person, if any, who controls the Company, the Advisor or the Dealer Manager (the “CMBD Parties”), against any and all Loss arising out of or based upon:

12.1.1    Any verbal or written representations in connection with the Offering made by such Selling Group Member, its employees or affiliates in violation of the Securities Act or the rules and regulations promulgated thereunder, or any other applicable federal or state securities laws and regulations;

12.1.2    Any use of sales materials or use of unauthorized verbal representations by such Selling Group Member, its employees or affiliates concerning the Offering in violation of the Soliciting Dealer Agreement or otherwise;

12.1.3    Such Selling Group Member’s failure to comply with any of the applicable provisions of the Securities Act, the Exchange Act, or the rules and regulations promulgated under both such acts, the applicable requirements and rules of FINRA, or any other applicable federal or state laws, rules or regulations;

12.1.4    The breach by such Selling Group Member of any term, condition, representation, warranty, or covenant of the Soliciting Dealer Agreement; or

12.1.5    The failure by any Subscriber of a Share to comply with the Investor suitability requirements set forth in the section captioned “Suitability Standards” in the Prospectus.

12.2    If any action is brought against the CMBD Parties in respect of which indemnity may be sought hereunder, the Company or the Dealer Manager shall promptly notify the applicable Selling Group Member in writing of the institution of such action, and the Selling Group Member shall assume the defense of such action; provided, however, that the failure to notify the Selling Group Member shall not affect the provisions in this Section 12 except to the extent such failure to notify the

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Selling Group Member has a material and adverse effect on the defense of such claims. The affected CMBD Parties shall have the right to employ counsel in any such case. The reasonable fees and expenses of such counsel shall be at such Selling Group Member’s expense and authorized in writing by such Selling Group Member, provided that such Selling Group Member will not be obligated to pay for legal fees and expenses for more than one law firm in connection with the defense of similar claims arising out of the same alleged acts or omissions.

12.3    The Selling Group Member agrees to promptly notify the Company and the Dealer Manager of the commencement of any litigation or proceedings against the Selling Group Member or any of the Selling Group Member’s officers, directors, partners, affiliates or agents in connection with the Offering.

12.4    The indemnity provided to the Dealer Manager pursuant to this Section 12 shall not apply to the extent that any Loss arises out of or is based upon any untrue statement or alleged untrue statement of material fact made by the Dealer Manager or any agent of the Dealer Manager, or any omission or alleged omission of a material fact required to be disclosed by the Dealer Manager or any agent of the Dealer Manager.

12.5    The indemnity provided to the Company pursuant to this Section 12 shall not apply to the extent that any Loss arises out of or is based upon any untrue statement or alleged untrue statement of material fact made by the Company or any agent of the Company (other than the Dealer Manager), or any omission or alleged omission of a material fact required to be disclosed by the Company or any agent of the Company (other than the Dealer Manager).

13.    Contribution. In order to provide for just and equitable contribution in circumstances in which the indemnification provided pursuant to Sections 10, 11 and 12 is for any reason held to be unavailable from the Company, the Dealer Manager or the Selling Group Members, as the case may be, the Company, the Dealer Manager and the Selling Group Members shall contribute to the aggregate Loss, liabilities, claims, damages and expenses (including any amount paid in settlement of any action, suit, or proceeding or any claims asserted) in such amounts as a court of competent jurisdiction may determine (or in the case of settlement, in such amounts as may be agreed upon by the parties) in such proportion to reflect the relative fault of the Company, the Dealer Manager and the Selling Group Members and their respective owners, managers, members, trustees, partners, directors, officers, employees, agents, attorneys and accountants in connection with the events described in Sections 10, 11 and 12, as the case may be, which resulted in such Loss, liabilities, claims, damages or expenses, as well as any other equitable considerations. The relative fault of the parties shall be determined by reference to, among other things, whether any untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company, the Dealer Manager and the Selling Group Members and their respective owners, managers, members, trustees, partners, directors, officers, employees, agents, attorneys and accountants and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such omission or statement. The parties and any person who controls the Company or the Dealer Manager shall also have rights to contribution under this Section 13.

14.    Compliance. All actions, direct or indirect, by the Dealer Manager and its agents, members, employees and affiliates, shall conform to (i) requirements applicable to broker-dealers under federal and applicable state securities laws, rules and regulations, and (ii) applicable requirements and rules of FINRA.

15.    Privacy Act. To protect Customer Information (as defined below) and to comply as may be necessary with the requirements of the Gramm-Leach-Bliley Act, the relevant state and federal regulations pursuant thereto and state privacy laws, the parties wish to include the confidentiality and non-disclosure obligations set forth herein.

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15.1    Customer Information. “Customer Information” means any information contained on a customer’s application or other form and all nonpublic personal information about a customer that a party receives from the other party. Customer Information shall include, but not be limited to, name, address, telephone number, social security number, health information and personal financial information (which may include consumer account number).

15.2    Usage and Nondisclosure. The parties understand and acknowledge that they may be financial institutions subject to applicable federal and state customer and consumer privacy laws and regulations, including Title V of the Gramm-Leach-Bliley Act (15 U.S.C. 6801, et seq.) and regulations promulgated thereunder (collectively, the “Privacy Laws”), and any Customer Information that one party receives from the other party is received with limitations on its use and disclosure. The parties agree that they are prohibited from using the Customer Information received from the other party other than (i) as required by law, regulation or rule or (ii) to carry out the purposes for which one party discloses Customer Information to the other party pursuant to the Agreement, as permitted under the use in the ordinary course of business exception to the Privacy Laws.

15.3    Safeguarding Customer Information. The parties shall establish and maintain safeguards against the unauthorized access, destruction, loss, or alteration of Customer Information in their control which are no less rigorous than those maintained by a party for its own information of a similar nature. In the event of any improper disclosure of any Customer Information, the party responsible for the disclosure will immediately notify the other party.

15.4    Survivability. The provisions of this Section 15 shall survive the termination of this Agreement.

16.    Survival of Provisions.

16.1    Except as the context otherwise requires, all representations, warranties and agreements contained in this Agreement shall be deemed to be representations, warranties and agreements at and through the termination of the Offering, and such representations, warranties and agreements by the Dealer Manager or the Company, including the indemnity agreements contained in Sections 10, 11 and 12 and the contribution agreements contained in Section 13 shall remain operative and in full force and effect regardless of any investigation made by the Dealer Manager, the Company and/or any controlling person, and shall survive the sale of, and payment for, the Shares.

16.2    The respective agreements and obligations of the Company and the Dealer Manager set forth in Sections 6.1, 6.4, 6.6, 6.7, 10 through 13, 16, 17, 18 through 31 of this Agreement shall remain operative and in full force and effect regardless of the termination of this Agreement.

17.    Costs of Offering. Except for the compensation payable to the Dealer Manager described in Section 7, which are the sole obligations of the Advisor, the Dealer Manager will pay all of its own costs and expenses, including, but not limited to, all expenses necessary for the Dealer Manager to remain in compliance with any applicable federal, state or FINRA laws, rules or regulations in order to participate in the Offering as a broker-dealer, and the fees and costs of the Dealer Manager’s counsel. The Advisor agrees to pay all other expenses incident to the performance of its obligations hereunder, including all expenses of the Company incident to filings with federal and state regulatory authorities and to the exemption of the Shares under federal and state securities laws, including fees and disbursements of the Company’s counsel, and all costs of reproduction and distribution of the Prospectus and any amendment or supplement thereto.

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18.    Termination.

18.1    Any party to this Agreement shall have the right to terminate this Agreement on 60 days’ written notice or immediately upon notice to the other party in the event that such other party shall have failed to comply with any material provision hereof. If not sooner terminated, the Dealer Manager’s agency and this Agreement shall terminate upon termination of the Offering Period without obligation on the part of the Dealer Manager, the Advisor or the Company, except as set forth in this Agreement. Such termination shall not affect the indemnification agreements set forth in Sections 10, 11 and 12 or the contribution agreements set forth in Section 13 or the other sections referenced in Section 16.2 herein. Upon the expiration or earlier termination of this Agreement, the Dealer Manager will use reasonable efforts to cooperate with the Company and any other party that may be necessary to accomplish an orderly transfer and transfer to a successor dealer manager of the operation and management of the services the Dealer Manager is providing to the Company under this Agreement, provided that the Company shall not be in material breach or default of this Agreement. The Dealer Manager will not be entitled to receive any additional payment in connection with the efforts described in the foregoing sentence.

18.2    Upon termination of this Agreement, (a) the Company shall pay to the Dealer Manager all accrued amounts payable under Section 7 hereof at such time as such amounts become payable and (b) the Dealer Manager shall promptly deliver to the Company all records and documents in its possession that relate to the Offering and that are not designated as “dealer” copies.

18.3    The term of this Agreement shall be extended to cover offerings of shares of the Company’s common stock pursuant to the DRP which are offered pursuant to one or more additional registration statements (each, a “DRP Registration Statement”) and prospectus contained therein. Upon the effectiveness of any such DRP Registration Statement, this Agreement shall automatically be deemed to cover the offering of such DRP shares, and the terms “Shares,” “Offering,” “Registration Statement” and “Prospectus” set forth herein shall be deemed to include the newly registered DRP shares, the DRP Registration Statement and the prospectus contained in the DRP Registration Statement, as applicable, as such DRP Registration Statement and prospectus may be amended or supplemented from time to time.

19.    Governing Law. This Agreement shall be governed by, subject to and construed in accordance with, the laws of the State of Utah without regard to conflict of law provisions.

20.    Dispute Resolution. Any controversy arising out of or related to this Agreement or the breach thereof shall be settled by arbitration in Salt Lake County, Utah, in accordance with the rules of The American Arbitration Association, and judgment entered upon the award rendered may be enforced by appropriate judicial action. The arbitration panel shall consist of one member, which shall be a person agreed to by each party to the dispute within 30 days following notice by one party that he desires that a matter be arbitrated. If the parties are unable within such 30 day period to agree upon an arbitrator, then the panel shall be one arbitrator selected by the Salt Lake County office of The American Arbitration Association, which arbitrator shall be experienced in the area of real estate and limited liability companies and who shall be knowledgeable with respect to the subject matter area of the dispute. The losing party shall bear any fees and expenses of the arbitrator, other tribunal fees and expenses, reasonable attorney’s fees of both parties, any costs of producing witnesses and any other reasonable costs or expenses incurred by him or the prevailing party or such costs shall be allocated by the arbitrator. The arbitration panel shall render a decision within 30 days following the close of presentation by the parties of their cases and any rebuttal. The parties shall agree within 30 days following selection of the arbitrator to any prehearing procedures or further procedures necessary for the arbitration to proceed, including interrogatories or other discovery; provided, in any event each party shall be entitled to discovery. Any action not resolved pursuant to the foregoing shall be brought only in a court of competent jurisdiction located in Salt Lake County, Utah.

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21.    Severability. If any portion of this Agreement shall be held invalid or inoperative, then so far as is reasonable and possible (i) the remainder of this Agreement shall be considered valid and operative and (ii) effect shall be given to the intent manifested by the portion held invalid or inoperative.

22.    Counterparts. This Agreement may be executed in 2 or more counterparts, each of which shall be deemed to be an original, and together which shall constitute one and the same instrument.

23.    Modification or Amendment. This Agreement may not be modified or amended except by written agreement executed by the parties hereto.

24.    Notices. All communications hereunder, except as herein otherwise specifically provided, shall be in writing and, if sent to the Dealer Manager, shall be mailed or delivered to Orchard Securities, LLC, 365 Garden Grove Lane, Suite 100, Pleasant Grove, Utah 84062, if sent to the Company shall be mailed or delivered to Cottonwood Communities, Inc., 6340 South 3000 East, Suite 500, Salt Lake City, UT 84121, if sent to the Advisor shall be mailed or delivered to CC Advisors III, LLC, 6340 South 3000 East, Suite 500, Salt Lake City, UT 84121. The notice shall be deemed to be received on the date of its actual receipt by the party entitled thereto.

25.    Parties. This Agreement shall be binding upon and inure solely to the benefit of the parties hereto, the persons referred to in Sections 10, 11, 12 and 13, their respective successors, legal representatives, heirs and assigns, and no other person shall have or be construed to have any legal or equitable right, remedy or claim under, in respect of, or by virtue of, this Agreement or any provision herein contained.

26.    Delay. Neither the failure nor any delay on the part of any party to this Agreement to exercise any right, remedy, power, or privilege under this Agreement shall operate as a waiver thereof, nor shall a waiver of any right, remedy, power, or privilege with respect to any occurrence be construed as a waiver of such right, remedy, power, or privilege with respect to any subsequent occurrence.

27.    Recovery of Costs. If any legal action or other proceeding is brought for the enforcement of this Agreement, or because of an alleged dispute, breach, default or misrepresentation in connection with any of the provisions of this Agreement, the successful or prevailing party shall be entitled to recover reasonable attorneys’ fees and other costs incurred in that action or proceeding (and any additional proceeding for the enforcement of a judgment) in addition to any other relief to which it or they may be entitled.

28.    Entire Agreement. This Agreement contains the entire understanding between the parties hereto and supersedes any prior understandings or written or oral agreements between them respecting the subject matter hereof.

29.    Confirmation. The Company agrees to confirm all orders for purchase of Shares that are accepted by the Company and provide such confirmation to the Dealer Manager and the Selling Group Members. To the extent practicable and permitted by law, all such confirmations may be provided electronically.

30.    Due Diligence. The Company will authorize a collection of information regarding the Offering (the “Due Diligence Information”), which collection the Company may amend and supplement

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from time to time, to be delivered by the Dealer Manager to the Selling Group Members (or their agents performing due diligence) in connection with their due diligence review of the Offering. In the event a Selling Group Member (or its agent performing due diligence) requests access to additional information or otherwise wishes to conduct additional due diligence regarding the Offering, the Company and the Dealer Manager will reasonably cooperate with such Selling Group Member to accommodate such request. All Due Diligence Information received by the Dealer Manager and/or the Selling Group Members in connection with their due diligence review of the Offering are confidential and shall be maintained as confidential and not disclosed by the Dealer Manager or the Selling Group Members except to the extent such information is disclosed in the Prospectus.

31.    Submission of Orders.

31.1    The Dealer Manager will require in its agreements with each Selling Group Member that each Selling Group Member will instruct those persons who purchase Shares to make their checks payable to the Company. The Dealer Manager and each Selling Group Member will return any check it receives not conforming to the foregoing instructions directly to such subscriber not later than the end of the next business day following its receipt. Checks received by the Dealer Manager or Selling Group Member that conform to the foregoing instructions shall be transmitted for deposit pursuant to one of the following methods:

31.2    Where, pursuant to the Selling Group Member’s internal supervisory procedures, internal supervisory review is conducted at the same location at which subscription documents and checks are received from subscribers, checks will be transmitted by the end of the next business day following receipt by the Selling Group Member for deposit to the Company or its agent.

31.3    Where, pursuant to the Selling Group Member’s internal supervisory procedures, final internal supervisory review is conducted at a different location, checks will be transmitted by the end of the next business day following receipt by the Selling Group Member to the office of the Selling Group Member conducting such final internal supervisory review (the “Final Review Office”). The Final Review Office will in turn by the end of the next business day following receipt by the Final Review Office transmit such checks for deposit to the Company or its agent.

31.4    Where the Dealer Manager receives investor proceeds, checks will be transmitted by the end of the next business day following receipt by the Dealer Manager for deposit to the Company or its agent.

If the foregoing correctly sets forth the understanding between the Dealer Manager, the Company and the Advisor, please so indicate in the space provided below for that purpose, and return one of the signed copies of this letter agreement to the Company whereupon this letter agreement shall constitute a binding agreement among us.

[signature page follows]

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Very truly yours,
COTTONWOOD COMMUNITIES, INC., a Maryland corporation
By:	/s/ Gregg Christensen

AGREED AND ACCEPTED:
ORCHARD SECURITIES, LLC, a Utah limited liability company
By:	/s/ Kevin Bradburn
Its:	President

Commission checks to be sent to:
Name:	Orchard Securities, LLC
Address:	365 Garden Grove Lane, Suite 100
	Pleasant Grove, Utah 84062

CC ADVISORS III, LLC, a Delaware limited liability company
By:	/s/ Gregg Christensen

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EXHIBIT A

ORCHARD SECURITIES, LLC

365 GARDEN GROVE LANE, SUITE 100

PLEASANT GROVE, UTAH 84062

FORM OF SOLICITING DEALER AGREEMENT

for Shares in

Cottonwood Communities, Inc.

            , 20    

Ladies and Gentlemen:

The undersigned, Orchard Securities, LLC, a Utah limited liability company (the “Dealer Manager”), has entered into an agreement (the “Dealer Manager Agreement”) with Cottonwood Communities, Inc., a Maryland corporation (the “Company”) and CC Advisor III, LLC, a Delaware limited liability company (the “Advisor”) for the sale to the public (the “Offering”) of up to $750,000,000 in Class A shares and Class T shares of common stock (the “Shares”) of the Company pursuant to a primary offering (the “Primary Offering”) and the Company’s distribution reinvestment plan (“DRP”), pursuant to which the Dealer Manager has agreed to use its best efforts to form and manage, as the Dealer Manager, a group of securities dealers (the “Selling Group Members”) for the purpose of soliciting offers for the purchase of the Shares. The Dealer Manager Agreement is attached as Exhibit A. Terms used but not otherwise defined in this Soliciting Dealer Agreement (this “Agreement”) have the same meanings as set forth in the Dealer Manager Agreement. The Shares will be offered at the prices and upon the terms set forth in the Prospectus (as amended and supplemented from time to time).

You are invited to become a Selling Group Member and by your confirmation hereof you agree to act in such capacity and to use your best efforts, in accordance with the following terms and conditions, to find qualified investors (the “Investors”) for the Shares. By your acceptance of this Agreement, you will become one of the Selling Group Members and will be entitled to and subject to the indemnification and contribution provisions contained in the Dealer Manager Agreement, including the provisions of the Dealer Manager Agreement wherein the Selling Group Members severally agree to indemnify and hold harmless the Company, the Advisor and the Dealer Manager for certain actions.

1.    Selling Group Member Representations, Covenants and Agreements.

1.1    You hereby confirm that you (i) are a member in good standing of the Financial Industry Regulatory Authority, Inc. (“FINRA”), (ii) are qualified and duly registered to act as a broker-dealer within all states in which you will sell the Shares, (iii) are a broker-dealer duly registered with the SEC pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and (iv) will maintain all such registrations and qualifications in good standing for the duration of your involvement in the Offering. You agree to immediately notify the Dealer Manager if you cease to be a member of FINRA in good standing.

1.2    You hereby agree to solicit, as an independent contractor, and not as the Dealer Manager’s agent, or as an agent of the Company or its affiliates, persons acceptable to the Company to purchase the Shares pursuant to the suitability standards set forth in the Prospectus, the Subscription Agreement in the form filed as an appendix to the Prospectus (the “Subscription Agreement”), and in accordance with the other terms of the Prospectus, and to diligently make inquiries as required by this

Agreement, the Prospectus or applicable law with respect to prospective Investors in order to ascertain whether a purchase of the Shares is suitable for the Investor. No Subscription Agreement shall be effective unless and until accepted by the Company, it being understood that the Company may accept or reject any Investor in its sole discretion and that the Company may terminate the Offering at any time for any reason

1.3    You understand that the offering of Shares is made on a “best-efforts” basis, as described in the Prospectus.

1.4    You agree that before participating in the Offering, you will have reasonable grounds to believe, based on information made available to you by the Dealer Manager and/or the Company through the Prospectus, that all material facts are adequately and accurately disclosed in the Prospectus and provide a basis for evaluating the Company and the Shares.

1.5    You agree not to execute any transaction in which an Investor invests in the Shares in a discretionary account without prior written approval of the transaction by the Investor and the Dealer Manager.

1.6    You agree to comply in all respects with the purchase procedures and plan of distribution set forth in the Prospectus. Further, you agree that although you may receive due diligence regarding the Offering from the Company in electronic form, you will not distribute to any prospective Investor or any other person any such due diligence material.

1.7    All subscriptions solicited by you will be strictly subject to confirmation by the Dealer Manager and acceptance thereof by the Company. Investors shall complete and execute a Subscription Agreement to subscribe for the purchase of Shares. The Company reserves the right in its absolute discretion to reject any such subscription and to accept or reject subscriptions in the order of their receipt by the Company, as appropriate or otherwise. Neither you nor any other person is authorized to, and neither you nor any of your employees, agents or representatives shall give any information or make any representation (written or oral) other than those contained in the Prospectus or in any Authorized Sales Materials furnished by the Dealer Manager or the Company for use in making solicitations in connection with the offer and sale of the Shares.

1.8    Upon authorization by the Dealer Manager, you may offer the Shares at the Offering price set forth in the Prospectus, subject to the terms and conditions thereof.

1.9    The Dealer Manager will provide you with such number of copies of the Prospectus as you may reasonably request. You will be solely responsible for correctly placing orders of such materials, and will reimburse the Dealer Manager for any costs incurred in connection with unreasonable or mistaken orders. The Dealer Manager also understands that the Company may provide you with certain Authorized Sales Materials to be used by you in connection with the solicitation of purchases of the Shares. You will deliver a copy of the Prospectus, including any amendments and supplements thereto, as required by the Securities Act, the Exchange Act and the rules and regulations promulgated under both such acts. You agree that (a) you will deliver a copy of the Prospectus as amended and supplemented to each Investor to whom an offer is made prior to or simultaneously with the first solicitation of an offer to sell the Shares to an Investor and (b) you will not use any Authorized Sales Materials in connection with the solicitation or purchase of the Shares unless accompanied or preceded by the Prospectus, as then currently in effect, and as it may be amended or supplemented in the future.

1.10    The Dealer Manager shall have full authority to take such action as it may deem advisable with respect to all matters pertaining to the Offering. The Dealer Manager shall be under no

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liability to you except for lack of good faith and for obligations expressly assumed by it in this Agreement. Nothing contained in this Section is intended to operate as, and the provisions of this Section shall not constitute a waiver by you, of compliance with any provision of the Securities Act, the Exchange Act, other applicable federal law, applicable state law or of the rules and regulations thereunder.

1.11    You agree that you will offer the Shares (both at the time of an initial subscription and at the time of any additional subscription, including enrollments and increased participations in the DRP) only to persons who meet the financial qualifications and suitability standards set forth in the Prospectus as amended or supplemented or in any suitability letter or memorandum sent to you by the Company or the Dealer Manager. Nothing contained in this Section 1.11 shall be construed to relieve you of your suitability obligations under FINRA Rule 2111 or FINRA Rule 2310.

1.12    You will limit the offering of the Shares to persons whom you have reasonable grounds to believe, and in fact believe, meet the financial suitability and other Investor requirements set forth in the Prospectus.

1.13    You will immediately bring to the attention of the Company and the Dealer Manager any circumstance or fact which causes you to believe the Prospectus, or any other Authorized Sales Materials distributed pursuant to the Offering, may be inaccurate or misleading.

1.14    You agree that in recommending to an Investor the purchase or sale of the Shares, you shall have reasonable grounds to believe, on the basis of information obtained from the prospective Investor concerning his or her investment objectives, other investments, financial situation and needs, and any other information known by you, that:

1.14.1    The prospective Investor meets the Investor suitability requirements set forth in the Registration Statement and the acquisition of Shares is otherwise a suitable investment for such Investor as may be required by all applicable laws, rules and regulations;

1.14.2    The prospective Investor is or will be in a financial position appropriate to enable him or her to realize to a significant extent the benefits described in the Registration Statement;

1.14.3    The prospective Investor has a fair market net worth sufficient to sustain the risks inherent in an investment in the Shares, including, but not limited to, the total loss of the investment, lack of liquidity and other risks described in the Registration Statement;

1.14.4    The prospective Investor will be acquiring the Shares for investment and not with a view a toward distribution; and

1.14.5    An investment in the Shares is otherwise suitable for the prospective Investor.

1.15    You agree to keep records in compliance with the requirements imposed by (i) federal and state securities laws and the rules and regulations thereunder, (ii) the applicable rules of FINRA and (iii) the Statement of Policy regarding Real Estate Investment Trusts of the North American Securities Administrators Association, Inc. (the “NASAA Guidelines”). You agree to retain in your records and make available to the Dealer Manager and to the Company, for a period of at least 6 years following the termination of the Offering, information establishing that (i) each person who purchases the Shares pursuant to a Subscription Agreement solicited by you is within the permitted class of Investors under the requirements of the jurisdiction in which such Investor is a resident, (ii) each person met the financial qualifications and suitability requirements imposed upon the offer and sale of the Shares (both at

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the time of the initial subscription and at the time of any additional subscriptions, including initial enrollments and increased participations in the DRP) set forth in the Prospectus and the Subscription Agreement and (iii) each person is suitable for such investment and the basis on which such suitability determination was made. You also agree to make your records regarding suitability available to representatives of the SEC and FINRA and applicable state securities administrators upon the Dealer Manager’s request.

1.16    You agree that before executing a purchase transaction in the Shares, you will inform the prospective Investor and his or her purchaser representative, if any, of all pertinent facts relating to the liquidity and marketability of the Shares, as appropriate, during the term of the investment.

1.17    You hereby undertake and agree to comply with all obligations applicable to you as set forth in FINRA rules, including, but not limited to, any new suitability and filing requirements.

1.18    You will not offer Shares in any jurisdiction unless and until (a) you have been advised in writing by the Company or the Dealer Manager that the Shares are either registered in accordance with, or exempt from, the securities laws of such jurisdiction and (b) you have all required licenses and registrations to offer Shares in that jurisdiction.

1.19    You agree not to rely upon the efforts of the Dealer Manager in (i) performing due diligence related to the Company (including its members, managers, officers, directors, employees, and affiliates), the Shares, or the suitability thereof for any Investors and (ii) determining whether the Company has adequately and accurately disclosed all material facts upon which to provide a basis for evaluating the Company to the extent required by federal law, state law and/or FINRA. You further agree that you are solely responsible for performing adequate due diligence, and you agree to perform adequate due diligence as required by federal law, state law, and/or FINRA.

1.20    You will refrain from making any representations to any prospective Investor other than those contained in the Prospectus, and will not allow any other written materials to be used to describe the potential investment to prospective Investors other than the Prospectus or Authorized Sales Materials prepared by the Company and distributed by the Dealer Manager for use in making solicitations in connection with the offer and sale of the Shares.

1.21    You will refrain from distributing any material to prospective Investors that is marked “Financial Advisor Use Only” or “Broker-Dealer Use Only,” or any other due diligence material related to the Offering received by you. You agree that you will not show or give to any investor or prospective investor in a particular jurisdiction any material or writing that is supplied to you by the Dealer Manager if such material bears a legend denoting that it is not to be used in connection with the sale of Shares to members of the public in such jurisdiction. You agree that you will not use in connection with the offer or sale of Shares any material or writing that relates to another company supplied to you by the Company or the Dealer Manager bearing a legend that states that such material may not be used in connection with the offer or sale of any securities of the Company.

1.22    You agree to furnish a copy of the Prospectus (as amended and supplemented) required for compliance with the provisions of federal and state securities laws and the rules and regulations thereunder, including Rule 15c2-8 under Exchange Act. Regardless of the termination of this Agreement, you will deliver a Prospectus (as amended and supplemented) in transactions in the Shares for a period of 90 days from the effective date of the Registration Statement or such other period as may be required by the Exchange Act or the rules and regulations thereunder.

1.23    [Intentionally omitted].

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1.24    You will provide the Dealer Manager with such information relating to the offer and sale of the Shares by you as the Dealer Manager may from time to time reasonably request.

The representations and warranties made in this Section 1 are and shall be continuing representations and warranties throughout the term of the Offering. In the event that any of these representations or warranties becomes untrue, the Selling Group Member will immediately notify the Dealer Manager in writing of the fact which makes the representation or warranty untrue.

2.    Submission of Orders.

Those persons who purchase Shares will be instructed by the Selling Group Member to make their checks payable to the Company. The Selling Group Member will return any check it receives not conforming to the foregoing instructions directly to such subscriber not later than the end of the next business day following its receipt. Checks received by the Selling Group Member that conform to the foregoing instructions shall be transmitted for deposit pursuant to one of the following methods:

Where, pursuant to the Selling Group Member’s internal supervisory procedures, internal supervisory review is conducted at the same location at which subscription documents and checks are received from subscribers, checks will be transmitted by the end of the next business day following receipt by the Selling Group Member for deposit to the Company or its agent.

Where, pursuant to the Selling Group Member’s internal supervisory procedures, final internal supervisory review is conducted at a different location, checks will be transmitted by the end of the next business day following receipt by the Selling Group Member to the office of the Selling Group Member conducting such final internal supervisory review (the “Final Review Office”). The Final Review Office will in turn by the end of the next business day following receipt by the Final Review Office transmit such checks for deposit to the Company or its agent.

3.    Compensation. Subject to certain conditions, and in consideration of your services hereunder, except as otherwise provided in the “Plan of Distribution” section of the Prospectus (as amended and supplemented), the Dealer Manager will pay you sales commissions, marketing allowances and Deferred Selling Commissions, as applicable, as follows to the extent you are authorized to participate in the distribution of the Class A shares and/or Class T shares, as applicable, as set forth on Schedule 1 hereto:

3.1    You will receive a selling commission up to 6.0% of the purchase price of the Class A Primary Sales by you and up to 3.0% of the purchase price of the Class T Primary Sales by you (the above being referred to as the “Commissions”).

3.2    You will receive a non-accountable marketing and due diligence allowance of 1% of the purchase price of the Primary Sales by you (the “Allowances”), which Allowances will be reallowed by the Dealer Manager from the dealer manager fees received by the Dealer Manager on the Primary Sales by you.

3.3    To the extent you have elected to participate in the distribution of Class T shares, you will receive Deferred Selling Commissions as set forth in this Section 3 and Schedule 1 hereto.

3.4    Payment of the Commissions, the Allowances and the Deferred Selling Commissions shall be subject to the following conditions:

(a)    No Commissions, Allowances or Deferred Selling Commissions will be payable with respect to any Subscription Agreements that are rejected by the Company or the

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Dealer Manager, or if the Company terminates the Offering for any reason whatsoever. No Commissions, Allowances or Deferred Selling Commissions will be payable to you with respect to any sale of the Shares by you unless and until such time as the Company has received the total proceeds of any such sale and the Company has accepted the Subscription Agreement of such subscriber.

(b)    No Commissions, Allowances or Deferred Selling Commissions will be payable to you with respect to any sale of the Primary Shares by you unless and until such time as the Dealer Manager has received the aggregate amount of sales commission, dealer manager fee or Deferred Selling Commission, as applicable, to which it is entitled.

3.5    You will not receive Commissions, Allowances or Deferred Selling Commissions in connection with any Shares sold pursuant to the DRP, and will not receive Deferred Selling Commissions in connection with sales of any Class A shares.

3.6    All other expenses incurred by you in the performance of your obligations hereunder, including, but not limited to, expenses related to the Offering and any attorneys’ fees, shall be at your sole cost and expense, and the foregoing shall apply notwithstanding the fact that the Offering is not consummated for any reason.

3.7    Once Commissions or Allowances become payable upon satisfaction of the conditions set forth in Section 3.4 above, they will be paid weekly with respect to the sale of Shares by the Dealer which closed during the immediately preceding week, after the Dealer Manager’s receipt of such Commissions or Allowances, as applicable, from the Advisor. Once Deferred Selling Commissions become payable upon satisfaction of the conditions set forth in Section 3.4 above and Schedule 1, they will be paid to you within 30 days after receipt by the Dealer Manager from the Advisor. You agree that, in the event any Commissions, Allowances or Deferred Selling Commissions have been paid to the Dealer Manager pursuant to the terms of the Dealer Manager Agreement, you will look solely to the Dealer Manager for payment of any Commissions, Allowances or Deferred Selling Commissions.

3.8    In the event that a purchase is revoked or rescinded, the Selling Group Member will be obligated to promptly return to the Dealer Manager any Commissions, Allowances or Deferred Selling Commissions previously paid to the Selling Group Member in connection with such purchase.

3.9    You agree that your compensation in connection to this Offering will be limited to the provisions of this Section 3 and Schedule 1. Furthermore, you agree not to charge a prospective Investor any fees in connection with this Offering.

3.10    You affirm that the Dealer Manager’s liability for Commissions, Allowances and Deferred Selling Commissions payable is limited solely to the proceeds of Commissions, Allowances and Deferred Selling Commissions receivable from the Advisor and you hereby waive any and all rights to receive payment of Commissions, Allowances and Deferred Selling Commissions due until such time as the Dealer Manager is in receipt of the Commission, Allowance and Deferred Selling Commission from the Advisor.

3.11    You acknowledge that the Company shall have no obligation, liability or responsibility whatsoever to pay any Commissions, Allowances or Deferred Selling Commissions in connection with the sale of Shares, either directly to you or to the Dealer Manager. You shall not bring any action, suit or other proceeding against the Company or any of its assets with respect to any Commissions, Allowances or Deferred Selling Commissions in connection with the sale of Shares, including without limitation, any proceedings claiming nonpayment of Commissions, Allowances or Deferred Selling Commissions by the Advisor. You further acknowledge that the Advisor is not liable or

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responsible for the direct payment of Commissions, Allowances or Deferred Selling Commissions to you. You acknowledge that, if the Advisor pays Commissions, Allowances or Deferred Selling Commissions to the Dealer Manager, the Advisor is relieved of any obligation for Commissions, Allowances or Deferred Selling Commissions to you. The Advisor may rely on and use the preceding acknowledgment as a defense against any claim by you for Commissions, Allowances or Deferred Selling Commissions that the Advisor pays to Dealer Manager but that Dealer Manager fails to remit to you.

3.12    Notwithstanding anything herein to the contrary, you will not be entitled to receive any Commissions, Allowances, Deferred Selling Commissions or any other compensation which would cause the total aggregate amount of Commissions, Allowances, Deferred Selling Commissions and other forms of underwriting compensation (as defined in accordance with applicable FINRA rules) received by the Dealer Manager and all Selling Group Members to exceed ten percent (10.0%) of the gross proceeds raised from the sale of Shares in the Primary Offering in the aggregate.

4.    Solicitation.

4.1    In connection with your participation in the offer and sale of Shares (including, without limitation all initial and additional subscriptions for Shares and any resales and transfers of Shares), you agree to comply with applicable requirements of (i) the Securities Act, the Exchange Act, and the rules and regulations promulgated under both such acts, (ii) applicable state securities laws and the published rules and regulations thereunder, (iii) the FINRA rules, (iv) all applicable rules and regulations relating to the suitability of investors, including, without limitation, the provisions of Article III.C. and III.E. of the NASAA Guidelines, (v) any other state and federal laws, rules and regulations applicable to the Offering, the sale of Shares or your activities pursuant to this Agreement and (vi) this Agreement and the Prospectus as amended and supplemented. In particular, you agree that you will not give any information or make any representations other than those contained in the Prospectus and in any Authorized Sales Materials furnished to you by the Dealer Manager or the Company for use in making solicitations in connection with the offer and sale of Shares. Further, with respect to any use by you of electronic delivery of offering documents or subscription agreements and electronic signatures, you agree to comply with the applicable requirements of the Statement of Policy Regarding Use of Electronic Offering Documents and Electronic Signatures of the North American Securities Administrators Association, Inc. (“NASAA”), as adopted by the NASAA membership on May 8, 2017, as well as the Electronic Signatures in Global and National Commerce Act and the Uniform Electronic Transactions Act referred to therein, each as may be amended from time to time, and you agree to execute and deliver to the Company the side letter attached as Schedule 2 of this Agreement and abide by the terms thereof.

4.2    You will conduct all solicitation and sales efforts in conformity with the Securities Act, and exemptions available under applicable state law and conduct reasonable investigation to ensure that all prospective Investors are not (i) listed on the Specially Designated Nationals and Blocked Persons List maintained by the Office of Foreign Asset Control, Department of the Treasury (“OFAC”) pursuant to Executive Order No. 13224, 66 Fed. Reg. 49079 (September 25, 2001) and/or on any other list of terrorists or terrorist organizations maintained pursuant to any of the rules and regulations of OFAC or pursuant to any other applicable enabling legislation or other Executive Orders in respect thereof (such lists are collectively referred to as “Lists”) or (ii) owned or controlled by, nor act for or on behalf of, any person or entity on the Lists.

4.3    You agree to promptly provide to the Dealer Manager copies of any written or otherwise documented complaints from customers received by you relating in any way to the Offering (including, but not limited to, the manner in which the Shares are offered by you).

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5.    Offer and Sale Activities. It is understood that under no circumstances will you engage in any activities hereunder in any state other than those for which permission has been granted by the Dealer Manager to you, as evidenced by written acknowledgement by the Dealer Manager that such state has been cleared for offer and sale activity. It is further understood that you shall notify the Company of Subscription Agreements you receive within 2 business days of receipt so that the Company may make any required federal or state law filings.

6.    Relationship of Parties. Except as specifically set forth in Schedule 2 hereto, nothing contained herein shall be construed or interpreted to constitute the Selling Group Member as an employee, agent or representative of, or in association with or in partnership with, the Dealer Manager or the Company. The Dealer Manager shall be under no liability to make any payment to you except out of the funds received pursuant to the terms of the Dealer Manager Agreement as hereinabove provided, and the Dealer Manager shall not be under any liability for, or in respect of the value or validity of the Subscription Agreement, the Shares or the performance by anyone of any agreement on its part, or for, or in respect of any matter connected with this Agreement, except for lack of good faith by the Dealer Manager, and for obligations expressly assumed by the Dealer Manager in this Agreement.

7.    Indemnification and Contribution. You hereby agree and acknowledge that you shall be entitled to the rights, and be subject to the obligations and liabilities, of the indemnification and contribution provisions contained in the Dealer Manager Agreement, including without limitation, the provisions by which the Selling Group Members shall severally agree to indemnify and hold harmless the Company and the Dealer Manager and their respective owners, managers, members, trustees, partners, directors, officers, employees, agents, attorneys and accountants.

8.    Privacy Act. To protect Customer Information (as defined below) and to comply as may be necessary with the requirements of the Gramm-Leach-Bliley Act, the relevant state and federal regulations pursuant thereto and state privacy laws, the parties wish to include the confidentiality and non-disclosure obligations set forth herein.

8.1    Customer Information. “Customer Information” means any information contained on a customer’s application or other form and all nonpublic personal information about a customer that a party receives from the other party. Customer Information shall include, but not be limited to, name, address, telephone number, social security number, health information and personal financial information (which may include consumer account number).

8.2    Usage and Nondisclosure. The parties understand and acknowledge that they may be financial institutions subject to applicable federal and state customer and consumer privacy laws and regulations, including Title V of the Gramm-Leach-Bliley Act (15 U.S.C. 6801, et seq.) and regulations promulgated thereunder (collectively, the “Privacy Laws”), and any Customer Information that one party receives from the other party is received with limitations on its use and disclosure. The parties agree that they are prohibited from using the Customer Information received from the other party other than (i) as required by law, regulation or rule, or (ii) to carry out the purposes for which one party discloses Customer Information to the other party pursuant to this Agreement, as permitted under the use in the ordinary course of business exception to the Privacy Laws.

8.3    Safeguarding Customer Information. The parties shall establish and maintain safeguards against the unauthorized access, destruction, loss, or alteration of Customer Information in their control which are no less rigorous than those maintained by a party for its own information of a similar nature. In the event of any improper disclosure of any Customer Information, the party responsible for the disclosure will immediately notify the other party.

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8.4    Survivability. The provisions of Section 7 and this Section 8 shall survive the termination of this Agreement.

9.    Survival of Provisions. Except as the context otherwise requires, all representations, warranties and agreements contained in this Agreement and in the applicable provisions of the Dealer Manager Agreement shall be deemed to be representations, warranties and agreements at and through the Offering Period, and such representations, warranties and agreements by the Dealer Manager or the Selling Group Members, including the indemnity agreements contained in Sections 10, 11 and 12 of, and the contribution agreements contained in Section 13 of, the Dealer Manager Agreement, shall remain operative and in full force and effect regardless of any investigation made by the Dealer Manager, the Selling Group Members and/or any controlling person, and shall survive the sale of, and payment for, the Shares and the termination of this Agreement.

10.    Termination. The Selling Group Member will suspend or terminate the Offering upon request of the Company or the Dealer Manager at any time and will resume the Offering upon the subsequent request of the Company or the Dealer Manager. This Agreement may be terminated by the Dealer Manager or a Selling Group Member at any time upon 5 days’ written notice to the other party. If this Agreement is terminated the Selling Group Member is still obligated to fulfill its delivery requirements pursuant to Sections 1.9 and 1.22.

11.    Dealer Manager Obligations.

11.1    Notifications. The Dealer Manager shall provide prompt written notice to the Selling Group Members of any material changes to the Registration Statement that in its judgment could materially and adversely affect a Selling Group Member with respect to this Offering.

11.2    Records. The Dealer Manager shall retain in its records and make available to the Selling Group Members, for a period of at least 6 years following the termination of the Offering, any communications and information with respect to a prospective Investor that has otherwise not been provided to a Selling Group Member.

11.3    FINRA Rule 5110. The Dealer Manager has submitted to FINRA (or will submit no later than one business day after filing with or submitting to the SEC or any state securities commission or other regulatory authority) a copy of the documents to be filed pursuant to FINRA Rule 5110(b)(5) and the information specified in FINRA Rule 5110(b)(6); provided, however, any documents that are filed with the SEC through the SEC’s EDGAR System that are referenced in FINRA’s electronic filing system shall be treated as filed with FINRA (the “FINRA Filing”). No sales of Shares shall commence unless such documents and information have been filed with and reviewed by FINRA and FINRA has provided an opinion that it has no objections to the proposed underwriting and other terms and arrangements.

11.4    Confirmation. The Dealer Manager hereby acknowledges that it has assumed the duty to confirm on behalf of the Selling Group Members all orders for purchases of Shares accepted by the Company. Such confirmations will comply with the rules of the SEC and FINRA and will comply with the applicable laws of such other jurisdictions to the extent that the Dealer Manager is advised of such laws in writing by the Selling Group Member.

12.    Governing Law. This Agreement shall be governed by, subject to and construed in accordance with the laws of the State of Utah without regard to conflict of law provisions.

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13.    Dispute Resolution. Any controversy arising out of or related to this Agreement or the breach thereof shall be settled by arbitration in Salt Lake County, Utah, in accordance with the rules of The American Arbitration Association, and judgment entered upon the award rendered may be enforced by appropriate judicial action. The arbitration panel shall consist of one member, which shall be a person agreed to by each party to the dispute within 30 days following notice by one party that he desires that a matter be arbitrated. If the parties are unable within such 30 day period to agree upon an arbitrator, then the panel shall be one arbitrator selected by the Salt Lake County office of The American Arbitration Association, which arbitrator shall be experienced in the area of real estate and limited liability companies and who shall be knowledgeable with respect to the subject matter area of the dispute. The losing party shall bear any fees and expenses of the arbitrator, other tribunal fees and expenses, reasonable attorney’s fees of both parties, any costs of producing witnesses and any other reasonable costs or expenses incurred by him or the prevailing party or such costs shall be allocated by the arbitrator. The arbitration panel shall render a decision within 30 days following the close of presentation by the parties of their cases and any rebuttal. The parties shall agree within 30 days following selection of the arbitrator to any prehearing procedures or further procedures necessary for the arbitration to proceed, including interrogatories or other discovery; provided, in any event each party shall be entitled to discovery. Any action not resolved pursuant to the foregoing shall be brought only in a court of competent jurisdiction located in Salt Lake County, Utah.

14.    Severability. If any portion of this Agreement shall be held invalid or inoperative, then so far as is reasonable and possible (i) the remainder of this Agreement shall be considered valid and operative and (ii) effect shall be given to the intent manifested by the portion held invalid or inoperative.

15.    Counterparts. This Agreement may be executed in 2 or more counterparts, each of which shall be deemed to be an original, and together which shall constitute one and the same instrument.

16.    Modification or Amendment. This Agreement may not be modified or amended except by written agreement executed by the parties hereto.

17.    Notices. All communications hereunder, except as herein otherwise specifically provided, shall be in writing and, (i) if sent to the Dealer Manager, shall be mailed or delivered to Orchard Securities, LLC, 365 Garden Grove Lane, Suite 100, Pleasant Grove, Utah 84062, (ii) if sent to the Company, shall be mailed or delivered to Cottonwood Communities, Inc., 6340 South 3000 East, Suite 500, Salt Lake City, Utah, 84121, or (iii) if sent to you, shall be mailed or delivered to you at your address set forth below. The notice shall be deemed to be received on the date of its actual receipt by the party entitled thereto.

18.    Parties. This Agreement shall be binding upon and inure solely to the benefit of the parties hereto, the persons referred to in Sections 10, 11, 12 and 13 of the Dealer Manager Agreement and in Section 5 of the side letter attached as Schedule 2 to this Agreement, their respective successors, legal representatives, heirs and assigns, and no other person shall have or be construed to have any legal or equitable right, remedy or claim under, in respect of, or by virtue of, this Agreement or any provision herein contained.

19.    Delay. Neither the failure nor any delay on the part of any party to this Agreement to exercise any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof, nor shall a waiver of any right, remedy, power or privilege with respect to any occurrence be construed as a waiver of such right, remedy, power or privilege with respect to any subsequent occurrence.

20.    Recovery of Costs. If any legal action or other proceeding is brought for the enforcement of this Agreement, or because of an alleged dispute, breach, default or misrepresentation in connection

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with any of the provisions of this Agreement, the successful or prevailing party shall be entitled to recover reasonable attorneys’ fees and other costs incurred in that action or proceeding (and any additional proceeding for the enforcement of a judgment) in addition to any other relief to which it or they may be entitled.

21.    Entire Agreement. This Agreement, along with the Schedules attached hereto and the applicable provisions of the Dealer Manager Agreement, constitute the entire understanding between the parties hereto and supersede any prior understandings or written or oral agreements between them respecting the subject matter hereof.

22.    Anti-Money Laundering Compliance Programs. Each Selling Group Member’s acceptance of this Agreement constitutes a representation to the Dealer Manager that the Selling Group Member has established and implemented an anti-money laundering (“AML”) compliance program (“AML Program”), in accordance with FINRA Rule 3310 and Section 352 of the Money Laundering Abatement Act, the Bank Secrecy Act, as amended, and Section 326 of the Patriot Act of 2001, which are reasonably expected to detect and cause reporting of suspicious transactions in connection with the sale of Shares. In addition, the Selling Group Member represents that it has established and implemented a program (“OFAC Program”) for compliance with OFAC and will continue to maintain its OFAC Program during the term of this Agreement. Upon request by the Dealer Manager at any time, the Selling Group Member hereby agrees to (i) furnish a copy of its AML Program and OFAC Program to the Dealer Manager for review and (ii) furnish a copy of the findings and any remedial actions taken in connection with the Selling Group Member’s most recent independent testing of its AML Program and/or its OFAC Program.

The parties acknowledge that for the purposes of the FINRA rules the Investors who purchase Shares through the Selling Group Member are “Customers” of the Selling Group Member and not the Dealer Manager. Nonetheless, to the extent that the Dealer Manager deems it prudent, the Selling Group Member shall cooperate with the Dealer Manager’s auditing and monitoring of the Selling Group Member’s AML Program and its OFAC Program by providing, upon request, information, records, data and exception reports, related to the Company’s investors introduced to, and serviced by, the Selling Group Member (the “Customers”). Such documentation could include, among other things: (i) copies of Selling Group Member’s AML Program and its OFAC Program; (ii) documents maintained pursuant to the Selling Group Member’s AML Program and its OFAC Program related to the Customers; (iii) any suspicious activity reports filed related to the Customers; (iv) audits and any exception reports related to the Selling Group Member’s AML activities; and (v) any other files maintained related to the Customers. In the event that such documents reflect, in the opinion of the Dealer Manager, a potential violation of the Dealer Manager’s obligations in respect of its AML or OFAC requirements, the Selling Group Member will permit the Dealer Manager to further inspect relevant books and records related to the Customers (with respect to the Offering) and/or the Selling Group Member’s compliance with AML or OFAC requirements. Notwithstanding the foregoing, the Selling Group Member shall not be required to provide to the Dealer Manager any documentation that, in the Selling Group Member’s reasonable judgment, would cause the Selling Group Member to lose the benefit of attorney-client privilege or other privilege which it may be entitled to assert relating to the discoverability of documents in any civil or criminal proceedings. The Selling Group Member hereby represents that it is currently in compliance with all AML rules and all OFAC requirements, specifically including, but not limited to, the Customer Identification Program requirements under Section 326 of the USA PATRIOT Act. The Selling Group Member hereby agrees, upon request by the Dealer Manager to (i) provide an annual certification to the Dealer Manager that, as of the date of such certification (A) its AML Program and its OFAC Program are consistent with the AML Rules and OFAC requirements, (B) it has continued to implement its AML Program and its OFAC Program and (C) it is currently in compliance with all AML Rules and OFAC requirements, specifically including, but not limited to, the Customer Identification Program requirements

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under Section 326 of the USA PATRIOT Act and (ii) perform and carry out, on behalf of both the Dealer Manager and the Company, the Customer Identification Program requirements in accordance with Section 326 of the USA PATRIOT Act and applicable SEC and Treasury Department Rules thereunder.

23.    Due Diligence. Pursuant to the Dealer Manager Agreement, the Company will authorize a collection of information regarding the Offering (the “Due Diligence Information”), which collection the Company may amend and supplement from time to time, to be delivered by the Dealer Manager to the Selling Group Member (or their agents performing due diligence) in connection with its due diligence review of the Offering. In the event the Selling Group Member (or its agent performing due diligence) requests access to additional information or otherwise wishes to conduct additional due diligence regarding the Offering, the Company, the Company’s sponsor or the sponsor’s affiliates and the Dealer Manager will reasonably cooperate with the Selling Group Member to accommodate such request. All Due Diligence Information received by the Selling Group Member in connection with its due diligence review of the Offering is confidential and shall be maintained as confidential and not disclosed by the Selling Group Member, except to the extent such information is disclosed in the Registration Statement.

24.    Electronic Delivery of Information; Electronic Processing of Subscriptions. Pursuant to the Dealer Manager Agreement, the Company has agreed to confirm all orders for the purchase of Shares accepted by the Company. In addition, the Company, the Dealer Manager and/or third parties engaged by the Company or the Dealer Manager may, from time to time, provide to the Selling Group Member copies of investor letters, annual reports and other communications provided to the Company investors. The Selling Group Member agrees that, to the extent practicable and permitted by law, all confirmations, statements, communications and other information provided to or from the Company, the Dealer Manager, the Selling Group Member and/or their agents or customers may be provided electronically, as a preference but not as a requirement. Notwithstanding the foregoing, the Selling Group Member is only authorized to electronically deliver the Prospectus and Authorized Sales Materials if the Selling Group Member has executed and delivered to the Company the side letter attached as Schedule 2 hereto and abides by the terms thereof.

With respect to Shares held through custodial accounts, the Selling Group Member agrees and acknowledges that to the extent practicable and permitted by law, all confirmations, statements, communications and other information provided from the Company, the Dealer Manager and/or their agents to Company investors may be provided solely to the custodian that is the registered owner of the Shares, rather than to the beneficial owners of the Shares. In such case it shall be the responsibility of the custodian to distribute the information to the beneficial owners of Shares.

The Selling Group Member agrees and acknowledges that the Dealer Manager may, as a preference but not as a requirement, use an electronic platform to process subscriptions, including but not limited to the Depository Trust Company (DTC) model. If an electronic platform is used, the Selling Group Member agrees to cooperate with the processing of subscriptions through such an electronic platform if reasonably practical; provided, that the Selling Group Member is only authorized to utilize electronic signatures of subscription agreements if the Selling Group Member has executed and delivered to the Company the side letter attached as Schedule 2 hereto and abides by the terms thereof.

25.    Third Party Beneficiaries. The Company and its affiliates, successors and assigns shall be express third party beneficiaries of Section 1 of this Agreement.

26.    Successors and Assigns. No party shall assign this Agreement or any right, interest or benefit under this Agreement without the prior written consent of the other party. This Agreement shall be binding upon the Dealer Manager and Selling Group Member and their respective successors and permitted assigns.

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Please confirm this Agreement to solicit persons to acquire the Shares on the foregoing terms and conditions by signing and returning the form enclosed herewith.

Very truly yours,

ORCHARD SECURITIES, LLC, a

Utah limited liability company

By:

Its:

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Orchard Securities, LLC

365 Garden Grove Lane, Suite 100

Pleasant Grove, Utah 84062

Re:    Offering of Shares in Cottonwood Communities, Inc.

Ladies and Gentlemen:

The undersigned confirms its agreement to act as a Selling Group Member as referred to in the foregoing Soliciting Dealer Agreement, subject to the terms and conditions of such Agreement. The undersigned confirms that it is a member in good standing of the Financial Industry Regulatory Authority, Inc., and is qualified under federal law and the laws of the states in which sales are to be made by the undersigned to act as a Selling Group Member.

Dated:         , 20
	(Print Name of Firm)

By:
	(Authorized Representative)

Address:

Taxpayer Identification Number:

Registered as broker-dealer in the following states:

☐ All States

☐ AL    ☐ AK    ☐ AZ    ☐ AR    ☐ CA    ☐ CO    ☐ CT    ☐ DE    ☐ DC    ☐ FL    ☐ GA    ☐ HI        ☐ ID

☐ IL      ☐ IN     ☐ IA    ☐ KS    ☐ KY    ☐ LA    ☐ ME    ☐ MD    ☐ MA    ☐ MI    ☐ MN    ☐ MS    ☐ MO

☐ MT    ☐ NE    ☐ NV    ☐ NH    ☐ NJ    ☐ NM    ☐ NY    ☐ NC    ☐ ND    ☐ OH    ☐ OK    ☐ OR    ☐ PA

☐ RI      ☐ SC     ☐ SD    ☐ TN    ☐ TX    ☐ UT    ☐ VT    ☐ VA    ☐ WA    ☐ WV    ☐ WI    ☐ WY    ☐ PR

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Schedule 1

To Soliciting Dealer Agreement

Share Class Election

CHECK EACH APPLICABLE BOX BELOW IF THE SELLING GROUP MEMBER ELECTS TO PARTICIPATE IN THE DISTRIBUTION OF THE LISTED SHARE CLASS

☐ Class A Shares        ☐ Class T Shares

Terms and Conditions of the Deferred Selling Commissions (Class T shares only).

The payment of the Deferred Selling Commission to Selling Group Member is subject to the terms and conditions set forth in the Soliciting Dealer Agreement between Dealer Manager and Selling Group Member, this Schedule 1 and the Prospectus as may be amended or supplemented from time to time. If Selling Group Member elects to sell Class T shares, eligibility to receive the Deferred Selling Commission with respect to the Class T shares sold by the Selling Group Member is conditioned upon the Selling Group Member acting as broker-dealer of record with respect to such Shares.

The Selling Group Member hereby represents by its acceptance of each payment of the Deferred Selling Commission that it complies with the above requirement. The Selling Group Member agrees to promptly notify the Dealer Manager if it is no longer the broker-dealer of record with respect to some or all of the Class T shares giving rise to such Deferred Selling Commissions.

Subject to the conditions described herein, the Dealer Manager will reallow to Selling Group Member the Deferred Selling Commission in an amount equal to 1.0% per annum of the per share estimated value of the Class T Primary Sales sold by Selling Group Member. To the extent payable, the Deferred Selling Commission will be payable monthly in arrears as provided in the Prospectus. All determinations regarding the total amount and rate of reallowance of the Deferred Selling Commission, the Selling Group Member’s compliance with the listed conditions, and/or the portion retained by the Dealer Manager will be made by the Dealer Manager in its sole discretion.

Notwithstanding the foregoing, subject to the terms of the Prospectus, upon the date when the Dealer Manager is notified that the Selling Group Member is no longer the broker-dealer of record with respect to such Class T shares, then Selling Group Member’s entitlement to the Deferred Selling Commissions related to such Class T shares shall cease, and Selling Group Member shall not receive the Deferred Selling Commission for any portion of the month in which Selling Group Member is not the broker dealer of record on the last day of the month; provided, however, if the change in the broker dealer of record with respect to such Class T shares is made in connection with a change in the registration of record for such Class T shares on the Company’s books and records (including, but not limited to, a re-registration due to a sale or a transfer or a change in the form of ownership of the account), then Selling Group Member shall be entitled to a pro rata portion of the Deferred Selling Commissions related to such Class T shares for the portion of the month for which Selling Group Member was the broker dealer of record.

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Thereafter, such Deferred Selling Commissions may be reallowed to the then-current broker-dealer of record of the Class T shares if any such broker-dealer of record has been designated (the “Servicing Dealer”), to the extent such Servicing Dealer has entered into a Soliciting Dealer Agreement or similar agreement with the Dealer Manager (“Servicing Agreement”) and such Soliciting Dealer Agreement or Servicing Agreement with the Servicing Dealer provides for such reallowance. In this regard, all determinations will be made by the Dealer Manager in good faith in its sole discretion. The Selling Group Member is not entitled to any Deferred Selling Commission with respect to Class A shares or any DRP shares. The Dealer Manager may also reallow some or all of the Deferred Selling Commission to other broker-dealers who provide services with respect to the Shares (who shall be considered additional Servicing Dealers) pursuant to a Servicing Agreement with the Dealer Manager to the extent such Servicing Agreement provides for such reallowance and such additional Servicing Dealer is in compliance with the terms of such agreement related to such reallowance, in accordance with the terms of such Servicing Agreement.

The Advisor and the Dealer Manager will cease paying the Deferred Selling Commission with respect to individual Class T shares when they are no longer outstanding, including as a result of conversion to Class A shares and redemption and repurchase. Each Class T share held within a stockholder’s account shall automatically and without any action on the part of the holder thereof convert into a number of Class A shares at the conversion rate set forth in the Prospectus on the earliest of (a) a listing of any Class A shares on a national securities exchange, (b) the merger or consolidation of the Company with or into another entity, or the sale or other disposition of all or substantially all of the Company’s assets and (c) the last calendar day of the month in which the Company and the Dealer Manager, in conjunction with the Company’s transfer agent, determines that the total Deferred Selling Commissions paid with respect to the Class T shares held by such stockholder within such account equals or exceeds three percent of the aggregate purchase price of Class T shares held by such stockholder within such account and purchased in the primary offering (i.e., excluding Class T shares purchased through the distribution reinvestment plan). In addition, after termination of the primary portion of an Offering, the Advisor and the Dealer Manager will cease paying the Deferred Selling Commissions with respect to each Class T share sold in the primary portion of that Offering, on the date when, the Company, with the assistance of the Dealer Manager, determine that all underwriting compensation paid or incurred in connection with such Offering from all sources, determined pursuant to the rules and guidance of FINRA, would be in excess of 10% of the aggregate purchase price of all sales of Primary Shares sold for the Company’s account in such Offering. Further, each such Class T share will automatically and without any action on the part of the holder thereof convert into a Class A share at the last calendar day of the month in which such determination is made.

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Schedule 2

To Soliciting Dealer Agreement

            , 20    

[name of soliciting dealer]

[address]

[address]

Re: Cottonwood Communities, Inc.

Ladies and Gentlemen:

Reference is made to the Soliciting Dealer Agreement (the “Soliciting Dealer Agreement”) as of [insert date] among [name of soliciting dealer] (“you”) and Orchard Securities, LLC (the “Dealer Manager”), relating to your participation in the distribution of shares of Cottonwood Communities, Inc. (the “Company”). All capitalized terms used but not otherwise defined herein shall have the meanings given them in the Soliciting Dealer Agreement.

You have indicated that you may wish to utilize electronic delivery with respect to the delivering of the Prospectus and Authorized Sales Materials and electronic signature with respect to a subscriber’s execution of a Subscription Agreement. In consideration of the mutual covenants hereinafter contained, the parties agree as follows:

1.    You will maintain written policies and procedures covering the delivery of electronic offering documents and the use of electronic signatures.

2.    You will comply with all applicable SEC rules and guidelines pertaining to electronic delivery of the Prospectus and Authorized Sales Materials and electronic signature of the Subscription Agreement.

3.    You will comply with all of the applicable requirements set forth in the NASAA Statement of Policy Regarding Use of Electronic Offering Documents and Electronic Signatures, as may be amended from time to time (the “Statement of Policy”). You will comply with such requirements in every U.S. jurisdiction irrespective of whether the jurisdiction has adopted the Statement of Policy. You acknowledge that you are acting as an agent of the Company only with respect to the delivery of the Prospectus and Authorized Sales Materials electronically, the administration of the subscription process and the obtainment of electronic signatures and only to the extent your actions are in compliance with the Statement of Policy and the Soliciting Dealer Agreement.

4.    You will also comply, as applicable, with the Electronic Signatures in the Global and National Commerce Act and the Uniform Electronic Transactions Act, to the extent applicable, as adopted in each applicable jurisdiction and any other applicable laws.

5.    You agree to indemnify and hold harmless the Company, the Dealer Manager, the Advisor and each person who controls any of them within the meaning of either Section 15 of the Securities Act (collectively, the “Indemnitees”), from and against any and all loss, liability, claim, damage and expense (including, without limitation, any legal or other expenses reasonably incurred in connection with defending, investigating or settling any such action or claim), as incurred, arising out of any breach of this agreement.

A-17

6.    This agreement is for the benefit of each of the Indemnitees.

7.    In consideration of the foregoing, the Company hereby agrees that it will not reject a subscription on account of an electronic signature if such signature was obtained in the manner set forth herein.

8.    This agreement shall be governed by and construed in accordance with the laws of the State of Utah, without reference to the choice-of-law principles thereof.

9.    Whenever possible, each provision of this agreement shall be interpreted in such manner as to be effective and valid under applicable law. If, however, any provision of this agreement is held, under applicable law, to be invalid, illegal, or unenforceable in any respect, such provision shall be ineffective only to the extent of such invalidity, and the validity, legality and enforceability of the remaining provisions of this agreement shall not be affected or impaired in any way.

10.    This agreement contains the entire understanding of the parties hereto with respect to the subject matter contained herein and supersedes all previous agreements and/or understandings of the parties.

11.    Sections 5, 6 and 8 through 11 shall survive termination of this agreement.

12.    This agreement may be executed in one or more counterparts and, when a counterpart has been executed by each party, all such counterparts taken together shall constitute one and the same agreement.

Very truly yours,
COTTONWOOD COMMUNITIES, INC.
By:
	Name:
	Title:

Accepted as of the date hereof:

[NAME OF SOLICITING DEALER]
By:
	Name:
	Title:

A-18

EXHIBIT A

DEALER MANAGER AGREEMENT

A-19

EX-10.5

Exhibit 10.5

AMENDED AND RESTATED

LIMITED PARTNERSHIP AGREEMENT

OF

COTTONWOOD COMMUNITIES O.P., LP

February 1, 2020

THE SECURITIES OFFERED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 NOR APPROVED OR DISAPPROVED BY THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION NOR BY THE SECURITIES REGULATORY AUTHORITY OF ANY STATE, NOR HAS ANY COMMISSION OR AUTHORITY PASSED UPON OR ENDORSED THE MERITS OF THIS OFFERING OR THE ACCURACY OR ADEQUACY OF ANY DISCLOSURE MADE IN CONNECTION THEREWITH. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. THE SECURITIES OFFERED HEREBY MAY NOT BE RESOLD WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF 1933 AND APPLICABLE STATE SECURITIES LAWS OR EXEMPTION THEREFROM. ANY TRANSFER OF THE SECURITIES REPRESENTED BY THIS AGREEMENT IS FURTHER SUBJECT TO OTHER RESTRICTIONS, TERMS, AND CONDITIONS WHICH ARE SET FORTH IN THIS AGREEMENT.

TABLE OF CONTENTS

			Page
1.	DEFINED TERMS			1
2.	PARTNERSHIP ORGANIZATION			11
	2.1	Organization		11
	2.2	Name		11
	2.3	Office and Registered Agent		11
	2.4	Partners		11
	2.5	Term and Dissolution		12
	2.6	Filing of Certificate and Perfection of Limited Partnership		12
	2.7	Partnership Interests are Securities		12
3.	PURPOSE			12
	3.1	Business of the Partnership		12
	3.2	Powers		12
	3.3	Relationship with Partners		12
4.	CAPITAL CONTRIBUTIONS AND ACCOUNTS			13
	4.1	Capital Contributions		13
	4.2	Additional Capital Contributions and Issuances of Additional Partnership Interests		13
	4.3	Issuances of Additional Partnership Interests		13
	4.4	General Partner Issuance of Additional Securities		14
	4.5	Additional Funding		15
	4.6	Capital Accounts		15
	4.7	Percentage Interests		16
	4.8	No Interest on Contributions		16
	4.9	Return of Capital Contributions		16
	4.10	No Third Party Beneficiary		16
	4.11	Issuance of Common Warrants		17
	4.12	Issuance of Series 2019 Preferred Units		17
5.	NET INCOME AND NET LOSS			17
	5.1	Allocation of Net Income and Net Loss		17
	5.2	Nonrecourse Deductions; Minimum Gain Chargeback		17
	5.3	Qualified Income Offset		18
	5.4	Capital Account Deficits		18
	5.5	Allocations Between Transferor and Transferee		18
	5.6	Definition of Net Income and Net Loss		19
	5.7	Curative Allocations		19
	5.8	Special Allocation		19
	5.9	Preferred Interest Designation		19
	5.10	Forfeiture Allocations		19
	5.11	LTIP Allocation Provisions		20
	5.12	Substantial Economic Effect		21
6.	DISTRIBUTIONS			22
	6.1	Distribution of Cash		22
	6.2	Withholding		22
	6.3	Tax Distribution		23

i

	6.4	REIT Distribution Requirements	23
	6.5	No Right to Distributions in Kind	23
	6.6	Limitations on Return of Capital Contributions	23
	6.7	Distributions Upon Liquidation	24
7.	RIGHTS, OBLIGATIONS AND POWERS OF THE GENERAL PARTNER		24
	7.1	Management of the Partnership	24
	7.2	Delegation of Authority	26
	7.3	Indemnification and Exculpation of Covered Persons	26
	7.4	Liability of the General Partner	28
	7.5	Reimbursement of General Partner	30
	7.6	Outside Activities	30
	7.7	Employment or Retention of Affiliates	30
	7.8	General Partner Participation	31
	7.9	Title to Partnership Assets	31
	7.10	Redemptions	31
	7.11	Reliance by Third Parties	32
	7.12	Officers	32
8.	CHANGES IN GENERAL PARTNER		33
	8.1	Transfer of the General Partner’s Partnership Interest	33
	8.2	Admission of a Substitute or Additional General Partner	34
	8.3	Effect of Bankruptcy, Withdrawal, Death or Dissolution of a General Partner	34
	8.4	Removal of a General Partner	35
9.	RIGHTS AND OBLIGATIONS OF THE LIMITED PARTNERS		36
	9.1	Management of the Partnership	36
	9.2	Power of Attorney	36
	9.3	Limitation on Liability of Limited Partners	36
	9.4	Exchange Right	36
	9.5	Call Right	39
	9.6	Put Option	40
10.	TRANSFERS OF LIMITED PARTNER INTERESTS		42
	10.1	Restrictions on Transfer of Limited Partner Interests	42
	10.2	Admission of Substitute Limited Partner	43
	10.3	Rights of Assignees of Partnership Interests	44
	10.4	Effect of Bankruptcy, Death, Incompetence or Termination of a Limited Partner	44
	10.5	Joint Ownership of Interests	44
11.	BOOKS AND RECORDS; ACCOUNTING; TAX MATTERS		45
	11.1	Books and Records	45
	11.2	Custody of Partnership Funds; Bank Accounts	45
	11.3	Fiscal and Taxable Year	45
	11.4	Annual Tax Information and Report	45
	11.5	Partnership Representative; Tax Elections	45
	11.6	Reports to Limited Partners	46
	11.7	Access to Books and Records	46
12.	AMENDMENT OF AGREEMENT; MERGER		47
	12.1	Amendment Related to Merger	47
	12.2	Amendment Without the Consent of the Limited Partners	47
	12.3	Meetings of Partners	48

ii

13.	TERM AND DISSOLUTION		50
	13.3	Certificate of Cancellation	50
	13.4	Liquidation of Property	50
	13.5	Distributions Upon Dissolution	50
14.	POWER OF ATTORNEY		51
15.	REPRESENTATIONS AND WARRANTIES		51
16.	GENERAL PROVISIONS		53
	16.1	Notices	53
	16.2	Survival of Rights	53
	16.3	Additional Documents	53
	16.4	Severability	53
	16.5	Entire Agreement	53
	16.6	Pronouns and Plurals	53
	16.7	Headings	53
	16.8	Counterparts	53
	16.9	Governing Law	53
	16.10	Electronic Signatures	54

EXHIBITS

Exhibit A – Partners’ Capital Contributions and Percentage Interests

Exhibit B – Notice of Exercise of Exchange Right

Exhibit C – Call Notice

Exhibit D – Partnership Unit Designation of the LTIP Units

Exhibit E – Notice of Election by Partner to Convert LTIP Units into Common Units

Exhibit F – Notice of Election by Partnership to Force Conversion of LTIP Units into Common Units

Exhibit G – Partnership Unit Designation of the Series 2019 Preferred Units

iii

AMENDED AND RESTATED

LIMITED PARTNERSHIP AGREEMENT

OF

COTTONWOOD COMMUNITIES O.P., LP

This Amended and Restated Limited Partnership Agreement of Cottonwood Communities O.P., LP (this “Agreement”) is entered into effective as of February 1, 2020, by and among Cottonwood Communities, Inc., a Maryland corporation (the “General Partner”) and the Limited Partners set forth on Exhibit A. Capitalized terms used herein but not otherwise defined shall have the meanings set forth in Section 1.

RECITALS

WHEREAS, the Partnership exists pursuant to that certain Limited Partnership Agreement dated August 13, 2018, as amended by the First Amendment to the Limited Partnership Agreement of Cottonwood Communities O.P., LP, dated March 18, 2019, and as amended by the Second Amendment to the Limited Partnership Agreement of Cottonwood Communities O.P., LP dated November 1, 2019 (collectively, the “Original Agreement”);

WHEREAS, the General Partner and the Special Limited Partner hereby desire to further amend the Original Agreement to establish the terms of a new series of Partnership Units designated as LTIP Units (which may be converted into Common Unit) to be issued from time to time and make certain other amendments to the Original Agreement;

WHEREAS, the General Partner and the Special Limited Partner hereby desire to amend and restate the Original Agreement in its entirety and enter into this Amended and Restated Limited Partnership Agreement of the Partnership.

NOW, THEREFORE, in consideration of the mutual covenants herein contained, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Partners hereby agree to amend and restate the Original Agreement in its entirety as follows:

1.    Defined Terms.

The following defined terms used in this Agreement shall have the meanings specified below:

“Act” means the Delaware Revised Uniform Limited Partnership Act, as it may be amended from time to time.

“Additional Limited Partner” means a Person admitted to the Partnership as a Limited Partner pursuant to Section 4.3 as reflected on Exhibit A.

“Additional Securities” means any additional REIT Shares (other than REIT Shares issued in connection with an exchange pursuant to Section 9.4) or rights, options, warrants, or convertible or exchangeable securities containing the right to subscribe for or purchase REIT Shares, as set forth in Section 4.4.

“Adjustment Year” has the meaning set forth in Section 6225(d)(2) of the Code.

“Administrative Expenses” means (i) all administrative and operating costs and expenses incurred by the Partnership, (ii) those administrative costs and expenses of the General Partner, including any

salaries or other payments to directors or officers of the General Partner, and any accounting and legal expenses of the General Partner, which expenses the Partners have agreed are expenses of the Partnership and not the General Partner and (iii) to the extent not included in clause (ii) above, REIT Expenses; provided, however, that Administrative Expenses shall not include any administrative costs and expenses incurred by the General Partner that are attributable to Properties or partnership interests in a GP Subsidiary (other than the Partnership) that are owned by the General Partner directly.

“Advisor” means Cottonwood Communities Management, LLC, a Delaware limited liability company, or any successor Advisor acting in such capacity under the terms of the Advisory Agreement.

“Advisory Agreement” means the Advisory Agreement among the Partnership, the General Partner and the Advisor dated August 13, 2018, as amended and restated from time to time.

“Advisory Agreement Termination Event” means the Advisor is terminated under the terms of the Advisory Agreement.

“Affiliate” means, with respect to any Person, (i) any Person directly or indirectly, owning, controlling or holding with the power to vote 10% or more of the outstanding voting securities of such other Person, (ii) any Person 10% or more of whose outstanding voting securities are directly or indirectly owned, controlled or held, with the power to vote, by such other Person, (iii) any Person directly or indirectly controlling, controlled by or under common control with such other Person, (iv) any executive officer, director, manager, trustee or general partner of such other Person and (v) any legal entity for which such Person acts as an executive officer, director, manager, trustee or general partner.

“Agreed Value” means the fair market value of a Partner’s non-cash Capital Contribution as of the date of contribution as agreed to by such Partner and the General Partner and in the case of any other required determination, the fair market value as determined by the General Partner in its sole discretion. The gross fair market value shall be reduced by any liabilities assumed in the transfer or to which the property is taken subject to. The General Partner shall establish the book value of the Partners’ Capital Accounts in its sole discretion.

“Agreement” means this Amended and Restated Limited Partnership Agreement of Cottonwood Communities O.P., LP, as amended or restated from time to time, as the context requires.

“Articles of Incorporation” means the Articles of Incorporation of the General Partner filed with the Maryland State Department of Assessments and Taxation, as amended or restated from time to time.

“Average Issue Price” means the weighted average price at which REIT Shares were purchased in the primary portion of any offering of the REIT Shares that is registered with the Securities and Exchange Commission, excluding REIT Shares offered under any employee benefit plan, which shall be calculated as of the end of the month preceding the date upon which the calculation is being made.

“Board of Directors” means the board of directors of the General Partner.

“Book-Up Target” for an LTIP Unit means (i) initially, the excess of the Common Unit Economic Balance as determined on the date such LTIP Unit was granted over any Capital Contribution made by such LTIP Unit Limited Partner with respect to such LTIP Unit and (ii) thereafter, as of any determination date, the remaining amount required to be allocated to such LTIP Unit for the Economic Capital Account Balance, to the extent attributable to such LTIP Unit, to be equal to the Common Unit Economic Balance. Notwithstanding the foregoing, the Book-Up Target shall be zero for any LTIP Unit from and after the time the Economic Capital Account Balance attributable to such LTIP Unit has reached an amount equal to the Common Unit Economic Balance determined as of such time.

2

“Call Notice” means a Call Notice, as defined in Section 9.5.1 and substantially in the form set forth on Exhibit C.

“Call Right” has the meaning set forth in Section 9.5.1.

“Called Unit” has the meaning set forth in Section 9.5.1.

“Capital Account” has the meaning set forth in Section 4.6.

“Capital Contribution” means the net amount of cash, cash equivalents and the Agreed Value of any Property or other asset contributed or agreed to be contributed, as the context requires, to the Partnership by each Partner pursuant to the terms of this Agreement. Any reference to the Capital Contribution of a Partner shall include the Capital Contribution made by a predecessor holder of the Partnership Interest of such Partner.

“Cash Amount” means an amount equal to the product of the Value of one REIT Share and the REIT Shares Amount on the applicable date of determination; provided, however, that the Cash Amount with respect to an LTIP Unit shall not exceed the positive Economic Capital Account Balance attributable to such LTIP Unit.

“Certificate” means that certain Certificate of Limited Partnership of the Partnership filed with the office of the Secretary of State of the State of Delaware, as amended from time to time in accordance with the terms hereof and the Act.

“Code” means the Internal Revenue Code of 1986, as amended, and as hereafter amended from time to time. Reference to any particular provision of the Code shall mean that provision in the Code at the date hereof and any successor provision of the Code.

“Commission” means the United States Securities and Exchange Commission.

“Common Limited Partner” means any Person named as a Common Limited Partner as set forth on Exhibit A, as such Exhibit may be amended from time to time, and any Person who becomes a Substitute Limited Partner or Additional Limited Partner, in such Person’s capacity as a Common Limited Partner in the Partnership.

“Common Unit” means an interest in the Partnership entitling a Common Limited Partner to the respective voting and other rights and Net Income and Net Loss as provided for in this Agreement, and specifically excludes the Special Limited Partner Interests, LTIP Units and the Preferred Units.

“Common Unit Economic Balance” means (i) the Capital Account balance of the General Partner, plus the amount of the General Partner’s share of any Partner Minimum Gain and Partnership Minimum Gain, in either case only to the extent attributable to the General Partner’s ownership of General Partner Units and computed on a hypothetical basis after taking into account all allocations through the date on which any allocation is made under Section 5.1, divided by (ii) the number of the General Partner Units.

“Common Warrants” mean warrants for the purchase of Common Units.

3

“Conversion Factor” means 1.0, provided that in the event that the General Partner (i) declares or pays a dividend on its outstanding REIT Shares in REIT Shares or makes a distribution to all holders of its outstanding REIT Shares in REIT Shares, (ii) subdivides its outstanding REIT Shares or (iii) combines its outstanding REIT Shares into a smaller number of REIT Shares (without conducting an analogous combination of the Common Units), the Conversion Factor shall be adjusted by multiplying the Conversion Factor by a fraction, the numerator of which shall be the number of REIT Shares issued and outstanding on the record date for such dividend, distribution, subdivision or combination (assuming for such purposes that such dividend, distribution, subdivision or combination has occurred as of such time), and the denominator of which shall be the actual number of REIT Shares (determined without the above assumption) issued and outstanding on such date and, provided further, that in the event that an entity other than an Affiliate of the General Partner shall become a General Partner pursuant to any merger, consolidation or combination of the General Partner with or into another entity (the “Successor Entity”), the Conversion Factor shall be adjusted by multiplying the Conversion Factor by the number of shares of the Successor Entity into which one REIT Share is converted pursuant to such merger, consolidation or combination, determined as of the date of such merger, consolidation or combination. Any adjustment to the Conversion Factor shall become effective immediately after the effective date of such event retroactive to the record date, if any, for such event; provided, however, that if the General Partner receives an Exchange Notice after the record date, but prior to the effective date of such dividend, distribution, subdivision or combination, the Conversion Factor shall be determined as if the General Partner had received the Exchange Notice immediately prior to the record date for such dividend, distribution, subdivision or combination.

“Covered Person” means (i) the General Partner, its Affiliates, or any of their respective officers, trustees, directors, stockholders, partners, members, employees, representatives or agents, (ii) any officer, employee, representative or agent of the Partnership and its Affiliates and (iii) such other Persons (including Affiliates of the General Partner or the Partnership) as the General Partner may designate as a “Covered Person” for purposes of this Agreement in its sole and absolute discretion.

“Defaulting Limited Partner” has the meaning set forth in Section 6.2.

“Distributions” means any distributions of money or other property by the General Partner to owners of REIT Shares, including distributions that may constitute a return of capital for federal income tax purposes.

“Economic Capital Account Balance” with respect to a Partner means an amount equal to its Capital Account balance, plus the amount of its share of any Partner Minimum Gains and Partnership Minimum Gain.

“Event of Bankruptcy” as to any Person means (i) the filing of a petition for relief as to such Person as debtor or bankrupt under the Bankruptcy Code of 1978 or similar provision of law of any jurisdiction (except if such petition is contested by such Person and is dismissed within 90 days), (ii) the insolvency or bankruptcy of such Person as finally determined by a court proceeding, (iii) the filing by such Person of a petition or application to accomplish the same or for the appointment of a receiver or a trustee for such Person or a substantial part of its assets or (iv) the commencement of any proceedings relating to such Person as a debtor under any other reorganization, arrangement, insolvency, adjustment of debt or liquidation law of any jurisdiction, whether now in existence or hereinafter in effect, either by such Person or by another, provided that if such proceeding is commenced by another, such Person indicates its approval of such proceeding, consents thereto or acquiesces therein, or such proceeding is contested by such Person and is not finally dismissed within 90 days.

4

“Excepted Holder Limit” means the percentage limit of the outstanding shares of stock of the General Partner of any class or series, including common shares or preferred shares, established by the Board of Directors for a Person that is exempt from the Shareholder Limitation.

“Exchange Date” means the date when all of the following have occurred: (i) the REIT Shares are listed on a national securities exchange, (ii) the Limited Partner has held its Common Units for at least one year (including, if applicable, the amount of time such Limited Partner held the Preferred Units or LTIP Units which were converted into such Common Units), (iii) the REIT Shares to be issued pursuant to the redemption have been registered with the SEC and the registration statement has been declared effective, or an exemption from registration is available and (iv) the exchange does not result in a violation of the Shareholder Limitation. Notwithstanding the above, the General Partner may waive any of the above in its sole discretion other than (ii) or (iv).

“Exchange Notice” means a Notice of Exercise of Exchange Right, substantially in the form set forth on Exhibit B.

“Exchange Right” has the meaning set forth in Section 9.4.1.

“Exchanging Partner” has the meaning set forth in Section 9.4.1.

“General Partner” means Cottonwood Communities, Inc., a Maryland corporation, and any Person who becomes a substitute or additional General Partner as provided herein, and any successor General Partner, in such Person’s capacity as a General Partner of the Partnership.

“General Partner Cash from Sales and Settlements” means the net cash proceeds realized by the General Partner (i) from the sale, exchange or other disposition of any of its assets or any portion thereof after deduction of all expenses incurred in connection therewith and (ii) from the prepayment, maturity, workout or other settlement of any real estate-related investment or portion thereof after deduction of all expenses incurred in connection therewith. In the case of the sale or settlement of an investment that is held through a joint venture, General Partner Cash from Sales and Settlements means the proceeds of any such transaction actually distributed to the General Partner from the joint venture or partnership.

“General Partner Liquidity Event” means (i) the sale of all or substantially all of the General Partner Interests held by the General Partner, (ii) or any sale, exchange or merger of the General Partner or (iii) any listing of the General Partner’s shares on a national securities exchange.

“General Partner Loan” has the meaning set forth in Section 6.2.

“General Partner Interest” means a Partnership Interest held by the General Partner.

“General Partner Operating Cash Flow” means the General Partner’s cash flow from ownership and/or operation of its investments, including investments held through a joint venture or partnership, minus the sum of (i) General Partner Operating Expenses and (ii) all principal and interest payments on indebtedness and other sums paid to lenders.

“General Partner Operating Expenses” means all costs and expenses incurred by the General Partner, as determined under generally accepted accounting principles, that in any way are related to the operation of the General Partner or to General Partner business, including fees paid to the external advisor to the General Partner.

5

“General Partner Unit” shall represent an interest in the Partnership entitling the General Partner to the respective voting and other rights and Net Income and Net Loss as provided for in this Agreement, but shall not include any Preferred Units held by the General Partner.

“GP Subsidiary” means any partnership, limited liability company, corporation, or other entity (other than the Partnership) of which a majority of (i) the voting power of the voting equity securities or (ii) the outstanding equity interests are owned by the General Partner or a direct or indirect Subsidiary of the General Partner.

“Imputed Underpayment” has the meaning set forth in Section 11.5.2(a).

“Independent Directors” shall have the meaning set forth in the Articles of Incorporation at such time as the Articles of Incorporation establish the definition.

“Ineligible Unit” has the meaning given to such term in Section 5.11.2(a).

“Joint Venture” means any joint venture or partnership (including a limited liability company) arrangement in which the Partnership is a co-venturer or partner (or member or manager) which is established to acquire Property.

“Limited Partner” means any Person named as a Common Limited Partner, Preferred Limited Partner, Special Limited Partner or LTIP Unit Limited Partner as set forth on Exhibit A, as such Exhibit may be amended from time to time, and any Person who becomes a Substitute Limited Partner or Additional Limited Partner, in such Person’s capacity as a Limited Partner in the Partnership.

“Limited Partner Interest” means a Partnership Interest held by a Limited Partner.

“Limited Partner Unit” means a Common Unit, Preferred Unit or LTIP Unit.

“Liquidating Gains” means any net gain realized in connection with the actual or hypothetical sale of all or substantially all of the assets of the Partnership (including upon the occurrence of any event of liquidation of the Partnership), including but not limited to net gain realized in connection with an adjustment to the book value of Partnership assets pursuant to Regulations Section 1.704-1(b)(2)(iv)(f).

“Liquidating Losses” means any net loss realized in connection with the actual or hypothetical sale of all or substantially all of the assets of the Partnership (including upon the occurrence of any event of liquidation of the Partnership), including but not limited to net loss realized in connection with an adjustment to the book value of Partnership assets pursuant to Regulations Section 1.704-1(b)(2)(iv)(f).

“LTIP Unit” means a Partnership Unit that is designated as an LTIP Unit having the rights, powers, privileges, restrictions, qualifications and limitations as set forth on Exhibit D and elsewhere in this Agreement in respect of an LTIP Unit Limited Partner. LTIP Units may be designated as “Special LTIP Units” or as “Vested” or “Unvested” LTIP Units pursuant to the documentation pursuant to which such LTIP Unit is issued.

“LTIP Unit Distribution Participation Date” means, for any LTIP Unit, the date of issuance or such other date as may be specified in the Vesting Agreement or other documentation pursuant to which such LTIP Unit is issued.

“LTIP Unit Limited Partner” means any Person that holds LTIP Units and is named as an LTIP Unit Limited Partner in the books and records of the Partnership (including as set forth on Exhibit A, as such Exhibit may be amended from time to time, to the extent applicable to the holding of such LTIP Units or Common Units issued to an LTIP Unit Limited Partner as provided on Exhibit D).

6

“Majority Vote” means the vote of more than 50% of the Participating Partnership Units entitled to vote. Limited Partners shall be entitled to cast one vote for each Participating Partnership Unit (other than LTIP Units) they own, and a fractional vote for each fractional Participating Partnership Unit (other than LTIP Units) they own. In the event that the Partnership does not obtain approval of at least 50% of the Participating Partnership Units (other than LTIP Units) entitled to vote, then the item, if acted upon at a meeting and not by written consent, will be deemed approved if at least 50% of the Participating Partnership Units (other than LTIP Units) that participated in the vote were cast in favor of approval of the item subject to the vote unless a greater percentage is mandated by applicable law.

“Net Income” has the meaning set forth in Section 5.6.

“Net Loss” has the meaning set forth in Section 5.6.

“Offer” has the meaning set forth in Section 8.1.2(b).

“Original Agreement” has the meaning set forth in the Recitals.

“Participating Partnership Unit” means a Common Unit, an LTIP Unit or a General Partner Unit, and excludes any Preferred Unit.

“Partner” means any General Partner or Limited Partner. The names and addresses of the Partners and the number of Partnership Units are set forth on Exhibit A.

“Partner Minimum Gain” has the meaning set forth in Regulations Section 1.704-2(i). A Partner’s share of Partner Minimum Gain shall be determined in accordance with Regulations Section 1.704-2(i)(5).

“Partnership” means Cottonwood Communities O.P., LP, a Delaware limited partnership.

“Partnership Interest” means an ownership interest in the Partnership held by a Partner at any particular time, including the right of such Partner to any and all benefits to which such Partner may be entitled as provided in this Agreement and in the Act, together with all obligations of such Partner to comply with the provisions of this Agreement and the Act.

“Partnership Loan” has the meaning set forth in Section 6.2.

“Partnership Minimum Gain” has the meaning as set forth in Regulations Section 1.704-2(b)(2). In accordance with Regulations Section 1.704-2(d), the amount of Partnership Minimum Gain is determined by first computing, for each Partnership nonrecourse liability, any gain the Partnership would realize if it disposed of the property subject to that liability for no consideration other than full satisfaction of the liability, and then aggregating the separately computed gains. A Partner’s share of Partnership Minimum Gain shall be determined in accordance with Regulations Section 1.704-2(g)(1).

“Partnership Record Date” means the record date established by the General Partner for the distribution of cash pursuant to Section 6.1, which record date shall be the same as the record date established by the General Partner for a distribution to its stockholders.

7

“Partnership Unit” means a Limited Partner Unit or a General Partner Unit. The Partnership Units held by each Partner are set forth on Exhibit A.

“Partnership Unit Designations” means the provisions set forth on Exhibit G which are incorporated herein as part of this Agreement.

“Percentage Interest” means the percentage ownership interest in the Partnership of each Common Limited Partner, LTIP Unit Limited Partner and the General Partner, as determined by dividing the number of Participating Partnership Units owned by such Partner by the total number of Participating Partnership Units then outstanding as set forth on Exhibit A, as such Exhibit may be amended from time to time, or in the case of LTIP Units on the books and records of the Partnership maintained by the General Partner; provided that, for purposes of allocations and distributions (i) prior to the LTIP Unit Distribution Participation Date for any LTIP Units, Percentage Interests will be calculated without including such LTIP Units in either the numerator or the denominator and (ii) prior to the Special LTIP Unit Full Participation Date for any tranche of Special LTIP Units, Percentage Interests will be calculated by only including a number of such Special LTIP Units equal to the number of such Special LTIP Units in such tranche outstanding multiplied by the Special LTIP Unit Sharing Percentage for such tranche of Special LTIP Units. The Percentage Interest of each Partner shall be as set forth on Exhibit A, as such Exhibit may be amended from time to time.

“Person” means any individual, partnership, limited liability company, corporation, joint venture, trust or other entity.

“Preferred Limited Partner” means any Person named as a Preferred Limited Partner (including any holder of Preferred Units) as set forth on Exhibit A, as such Exhibit may be amended from time to time, and any Person who becomes a Substitute Limited Partner or Additional Limited Partner, in such Person’s capacity as a Preferred Limited Partner in the Partnership. For the avoidance of doubt, the General Partner will be a Preferred Limited Partner to the extent it holds Preferred Units.

“Preferred Shares” shall have the meaning set forth in Section 7.10.

“Preferred Units” shall represent an interest in the Partnership (including Series 2019 Preferred Units) entitling a Preferred Limited Partner to a priority on cash flow or liquidation over the holders of Participating Partnership Units and the Special Limited Partner Interests, and to the respective rights and Net Income and Net Loss as provided for in this Agreement.

“Property” means any Real Estate Related Asset, or other investment in which the Partnership holds an ownership interest.

“Put Notice” has the meaning set forth in Section 9.6.1.

“Put Right” has the meaning set forth in Section 9.6.1.

“Put Unit” has the meaning set forth in Section 9.6.1.

“Real Estate” means (i) the real property, including the buildings located thereon, (ii) the real property only or (iii) the buildings only, which are acquired by the Partnership, either directly or through Joint Ventures.

“Real Estate Related Assets” means unimproved and improved Real Estate including any related assets and any direct or indirect interest therein, including, without limitation, fee or leasehold interests,

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options, leases, Joint Venture interests, equity and debt securities of entities that own real estate, mortgages on Real Estate, mezzanine loans secured by junior liens on Real Estate, preferred equity interests in a property owner’s interest in Real Estate and other contractual rights in real estate.

“Regulations” means the Federal income tax regulations promulgated under the Code, as amended and as hereafter amended from time to time. Reference to any particular provision of the Regulations shall mean that provision of the Regulations on the date hereof and any successor provision of the Regulations.

“Regulatory Allocations” has the meaning set forth in Section 5.7.

“REIT” means a real estate investment trust described under Sections 856 through 860 of the Code.

“REIT Expenses” means (i) costs and expenses relating to the formation and continuity of existence and operation of the General Partner and any Subsidiaries thereof (which Subsidiaries shall, for purposes of this Agreement, be included within the definition of General Partner), including taxes, fees and assessments associated therewith, any and all costs, expenses or fees payable to any director or officer of the General Partner, asset management and other fees payable to the General Partner, (ii) costs and expenses relating to any offering, issuance or registration of securities by the General Partner and all statements, reports, fees and expenses incidental thereto, including, without limitation, underwriting discounts and selling commissions applicable to any such offering of securities, and any costs and expenses associated with any claims made by any holders of such securities or any underwriters or placement agents thereof, (iii) costs and expenses associated with any repurchase of any securities by the General Partner, (iv) costs and expenses associated with the preparation and filing of any periodic or other reports and communications by the General Partner under federal, state or local laws or regulations, including filings with the Commission or any state, (v) costs and expenses associated with compliance by the General Partner with laws, rules and regulations promulgated by any regulatory body, including the Commission, any state and any securities exchange, (vi) costs and expenses incurred by the General Partner relating to any issuance or redemption of Partnership Interests or REIT Shares and (vii) all other operating or administrative costs of the General Partner incurred in the ordinary course of its business on behalf of or in connection with the Partnership.

“REIT Share” means a share of common stock in the General Partner (or successor entity, as the case may be).

“REIT Shares Amount” means a number of REIT Shares equal to the product of the number of Common Units offered for exchange by an Exchanging Partner, multiplied by the Conversion Factor as adjusted to and including the Specified Exchange Date; provided that in the event the General Partner issues to all holders of REIT Shares or options, warrants, convertible or exchangeable securities or other rights entitling the stockholders to subscribe for or purchase REIT Shares, or any other securities or property (collectively, the “rights”), and the rights have not expired at the Specified Exchange Date, then the REIT Shares Amount shall also include the rights issuable to a holder of the REIT Shares on the record date fixed for purposes of determining the holders of REIT Shares entitled to rights.

“Securities Act” means the Securities Act of 1933, as amended and the rules and regulations promulgated thereunder.

“Series 2019 Preferred Unit” shall represent an interest in the Partnership entitling a holder of Series 2019 Preferred Units to the respective voting and other rights and Net Income and Net Loss as provided for in this Agreement.

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“Shareholder Limitation” means not more than 9.8% (i) in value of the aggregate outstanding shares of all classes or series of stock of the General Partner and (ii) in value or in number of shares (whichever is more restrictive) of the aggregate outstanding shares of common stock of the General Partner.

“Share NAV” means the value of a REIT Share, as determined by the Board of Directors.

“Special Limited Partner” means Cottonwood Communities Investor, LLC, a Delaware limited liability company.

“Special Limited Partner Interest” means an interest in the Partnership entitling the Special Limited Partner to an interest in the distributions set forth in Section 6.1.1(c), and any corresponding allocations of Net Income and Net Loss under this Agreement.

“Special LTIP Unit” means an LTIP Unit designated as a “Special LTIP Unit” as set forth in the documentation pursuant to which such LTIP Unit is granted.

“Special LTIP Unit Full Participation Date” means, for a Special LTIP Unit, the date specified as such in the documentation pursuant to which such Special LTIP Unit is granted.

“Special LTIP Unit Sharing Percentage” means, with respect to a Special LTIP Unit, 10% or such other percentage designated as the Special LTIP Unit Sharing Percentage for such Special LTIP Unit as set forth in the documentation pursuant to which such Special LTIP Unit is granted.

“Specified Exchange Date” means the first business day of the month that is at least 60 business days after the receipt by the General Partner of the Exchange Notice.

“Stockholder” means a holder of a REIT Share.

“Stockholders’ 6% Return” means, as of any date, an aggregate amount equal to a 6% cumulative, non-compounded, annual return on Stockholders’ Invested Capital (calculated like simple interest on a daily basis based on a three hundred sixty-five day year). For purposes of calculating the Stockholders’ 6% Return, Stockholders’ Invested Capital shall be determined for each day during the period for which the Stockholders’ 6% Return is being calculated, including a daily adjustment to reflect shares repurchased by the General Partner (excluding REIT Shares issued as stock dividends and subsequently repurchased by the General Partner), and shall be calculated net of (1) Distributions of General Partner Cash from Sales and Settlements and (2) Distributions of General Partner Operating Cash Flow to the extent such Distributions of General Partner Operating Cash Flow provide a cumulative, non-compounded, annual return in excess of 6%, as such amounts are computed on a daily basis based on a three hundred sixty-five day year.

“Stockholders’ Invested Capital” means the amount calculated by multiplying the total number of REIT Shares purchased by Stockholders by the issue price, reduced by the total number of shares repurchased by the General Partner multiplied by the Average Issue Price.

“Subsidiary” means, with respect to any Person, any corporation or other entity of which a majority of (i) the voting power of the voting equity securities or (ii) the outstanding equity interests are owned, directly or indirectly, by such Person.

“Substitute Limited Partner” means any Person admitted to the Partnership as a Limited Partner pursuant to Section 10.2.

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“Successor Entity” has the meaning set forth in the definition of “Conversion Factor.”

“Surviving General Partner” has the meaning set forth in Section 8.1.3.

“Target Balance” has the meaning set forth in Section 5.11.2(a).

“Transaction” has the meaning set forth in Section 8.1.2.

“Transaction Value” means an amount determined by assuming the value of the consideration used in the General Partner Liquidity Event and interpolating the gross value of the Partnership assets from such amount. If the event triggering the payment is a listing of the General Partner’s stock on a national securities exchange, the fair market value will be calculated based on the market value of the General Partner’s stock issued and outstanding at listing, measured by taking the average closing price or the average of the bid and asked price, as the case may be, during a period of 30 trading days commencing after the first day of the 6th month, but no later than the last day of the 18th month following listing, the commencement date of which shall be chosen by the Special Limited Partner in its sole discretion.

“Transfer” has the meaning set forth in Section 10.1.1.

“Value” means the fair market value per share of REIT Shares which will equal: (i) if the REIT Shares are listed on a national stock exchange, the average closing price per share for the previous 30 trading days (or such fewer number of trading days as such REIT Shares have traded on such exchange, if such number of trading days is fewer than 30) and (ii) if the REIT Shares are not listed, it shall mean the Share NAV.

“Vesting Agreement” means an award, vesting or other similar agreement pursuant to which LTIP Units are issued to an LTIP Unit Limited Partner.

2.    Partnership Organization.

2.1    Organization. The Partners hereby continue the limited partnership that was formed on December 21, 2016 as a limited partnership pursuant to the Act, for the purposes and upon the terms and conditions set forth in this Agreement. In the event of a conflict between the Act and this Agreement, unless a provision is expressly prohibited in the Act, the terms of this Agreement shall control.

2.2    Name. The name of the Partnership is Cottonwood Communities O.P., LP. The General Partner may change the name of the Partnership or conduct the business under another name and shall notify the Limited Partners of any such change.

2.3    Office and Registered Agent. The specified office and place of business of the Partnership shall be 6340 South 3000 East, Suite 500, Salt Lake City, Utah 84121. The General Partner may at any time change the location of such office, provided the General Partner gives notice to the Partners of any such change. The name and address of the Partnership’s registered agent is Corporation Service Company, 251 Little Falls Drive, City of Wilmington, County of New Castle, Delaware 19808. The General Partner may at any time change the Partnership’s registered agent, provided the General Partner gives notice to the Partners of any such change.

2.4    Partners.

2.4.1    The General Partner of the Partnership is Cottonwood Communities, Inc., a Maryland corporation. Its principal place of business is the same as that of the Partnership.

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2.4.2    The Limited Partners are those Persons identified as Limited Partners on Exhibit A, as amended from time to time. The Partners agree that Exhibit A will be confidential and maintained in the offices of the General Partner.

2.5    Term and Dissolution. The Partnership shall have a perpetual duration, except that the Partnership shall be dissolved pursuant to the provision of Section 13.

2.6    Filing of Certificate and Perfection of Limited Partnership. The General Partner shall execute, acknowledge, record and file at the expense of the Partnership, any and all amendments to the Certificate and all requisite fictitious name statements and notices in such places and jurisdictions as may be necessary to cause the Partnership to be treated as a limited partnership under, and otherwise to comply with, the laws of each state or other jurisdiction in which the Partnership conducts business.

2.7    Partnership Interests are Securities. All Partnership Interests shall be securities within the meaning of, and governed by, (i) Article 8 of the Delaware Uniform Commercial Code and (ii) Article 8 of the Uniform Commercial Code of any other applicable jurisdiction. The Partnership Interest of each Partner shall be personal property for all purposes.

3.    Purpose.

3.1    Business of the Partnership.

The purpose and nature of the business to be conducted by the Partnership is (i) to conduct any business that may be lawfully conducted by a limited partnership organized pursuant to the Act; provided, however, that such business shall be limited to and conducted in such a manner as to permit the General Partner at all times to qualify as a REIT, and in a manner such that the General Partner will not be subject to any taxes under Section 857 or 4981 of the Code, unless the General Partner otherwise ceases to or does not qualify as a REIT, (ii) to enter into any partnership, joint venture or other similar arrangement to engage in any of the foregoing or the ownership of interests in any entity engaged in any of the foregoing and (iii) to do anything necessary, convenient or incidental to the foregoing. In connection with the foregoing, and without limiting the General Partner’s right in its sole and absolute discretion to qualify or cease qualifying as a REIT, the Partners acknowledge that the General Partner intends to qualify as a REIT for federal income tax purposes, the avoidance of income and excise taxes on the General Partner inures to the benefit of all the Partners and not solely to the General Partner. Notwithstanding the foregoing, the Limited Partners agree that the General Partner may terminate its status as a REIT under the Code at any time to the full extent permitted under its Articles of Incorporation. The General Partner shall also be empowered to do any and all acts and things necessary or prudent to ensure that the Partnership will not be classified as a “publicly traded partnership” for purposes of Section 7704 of the Code.

3.2    Powers. The Partnership is empowered to do any and all acts and things necessary, appropriate, proper, advisable, incidental to or convenient for the furtherance and accomplishment of the purposes and business described herein and for the protection and benefit of the Partnership, including, without limitation, full power and authority, directly or through its ownership interest in other entities, to enter into, perform and carry out contracts of any kind, borrow money and issue evidences of indebtedness, whether or not secured by mortgage, deed of trust, pledge or other lien, acquire, own, manage, improve and develop real property, and lease, sell, transfer and dispose of Real Estate Related Assets or other ownership interests. In addition, the General Partner shall have all power to take any action necessary to maintain its status as a REIT as set forth in Section 3.1.

3.3    Relationship with Partners. It is expressly acknowledged and agreed by the Partners that the General Partner may, in its sole and absolute discretion, waive or otherwise modify the application

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with respect to any Partner or assignee of any provision herein restricting, prohibiting or otherwise relating to (i) the transfer of a Limited Partner Interest or the Partnership Units evidencing the same, (ii) the admission of any Limited Partners and (iii) the redemption rights of such Partners, and that such waivers or modifications may be made by the General Partner at any time or from time to time, including, without limitation, concurrently with the issuance of any Partnership Units pursuant to the terms of this Agreement.

4.    Capital Contributions and Accounts.

4.1    Capital Contributions. The General Partner and the Limited Partners have made capital contributions to the Partnership in exchange for the Partnership Interests set forth opposite their names on Exhibit A, as such Exhibit may be amended from time to time. The Partners shall receive the Percentage Interests indicated on Exhibit A, as such Percentage Interests may be adjusted from time to time by the General Partner to the extent necessary to reflect exchanges, redemptions, additional Capital Contributions, the issuance of additional Partnership Interests or other events having an effect on a Partner’s Percentage Interest. The General Partner shall have the power and authority to amend Exhibit A to reflect the issuance, redemption, exchange or other change in any Partnership Interest.

4.2    Additional Capital Contributions and Issuances of Additional Partnership Interests. Except as provided in Sections 4.3, 4.4 or 4.5, the Partners shall have no right or obligation to make any additional Capital Contributions or loans to the Partnership.

4.3    Issuances of Additional Partnership Interests. The General Partner is hereby authorized to cause the Partnership to issue additional Partnership Interests in the form of Participating Partnership Units or Preferred Units, and to admit such Person as a Partner, for any Partnership purpose at any time or from time to time, including but not limited to additional classes of Partnership Units issued in connection with acquisitions of properties, to the Partners (including the General Partner) or to other Persons for such consideration and on such terms and conditions as shall be established by the General Partner in its sole and absolute discretion, all without the approval of any Limited Partner. Without limiting the foregoing, the General Partner is expressly authorized to cause the Partnership to issue Partnership Units (i) upon the conversion, redemption or exchange of any debt or other securities issued by the Partnership, (ii) for less than fair market value, so long as the General Partner concludes in good faith that such issuance is in the best interests of the General Partner and the Partnership and (iii) in connection with any merger of any other entity into the Partnership or any Subsidiary of the Partnership if the applicable merger agreement provides that entity or its owners are to receive Partnership Units in exchange for their interests in the entity merging into the Partnership or any Subsidiary of the Partnership. Any additional Partnership Interests issued thereby may be issued in one or more classes, or one or more series of any of such classes, with such designations, preferences, redemption rights, conversion rights and other special rights, powers and duties, including rights, powers and duties senior to any Limited Partner Interests, all as shall be determined by the General Partner in its sole and absolute discretion and without the approval of any Limited Partner. Without limiting the generality of the foregoing, the General Partner shall have authority to specify (A) the allocations of items of Partnership income, gain, loss, deduction and credit to each such class or series of Partnership Interests, (B) the right of each such class or series of Partnership Interests to share in Partnership distributions, (C) the rights of each such class or series of Partnership Interests upon dissolution and liquidation of the Partnership, (D) the voting rights, if any, of each such class or series of Partnership Interests and (E) the conversion, redemption or exchange rights applicable to each such class or series of Partnership Interests; provided, however, that no additional Partnership Interests shall be issued to the General Partner unless:

4.3.1    (i) the additional Partnership Interests are issued in connection with an issuance of REIT Shares or other interests in the General Partner, (including but not limited to an internalization of

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the property management or advisor contracts) which REIT Shares or interests have designations, preferences and other rights, such that the economic interests are substantially similar to the designations, preferences and other rights of the additional Partnership Interests issued to the General Partner by the Partnership in accordance with this Section 4.3 and (ii) the General Partner shall make a Capital Contribution to the Partnership in an amount equal to the proceeds raised in connection with the issuance of such REIT Shares or other interests in the General Partner;

4.3.2    the additional Partnership Interests are issued in exchange for Property or other assets owned by the General Partner with a fair market value, as determined by the General Partner, in good faith, equal to the value of the Partnership Interests; or

4.3.3    the additional Partnership Interests are issued to all Partners in proportion to their respective Percentage Interests with respect to the class of Partnership Interests so issued.

4.4    General Partner Issuance of Additional Securities.

4.4.1    The General Partner shall not issue any Additional Securities other than to all holders of REIT Shares, unless (i) the General Partner shall cause the Partnership to issue to the General Partner, as the General Partner may designate, Partnership Interests or options, warrants, convertible or exchangeable securities or other rights of the Partnership having designations, preferences and other rights, such that the economic interests are substantially similar to those of the Additional Securities and (ii) the General Partner contributes the net proceeds from the issuance of such Additional Securities and from any exercise of rights contained in such Additional Securities, directly and through the General Partner, to the Partnership. Notwithstanding the above, the General Partner is allowed to issue Additional Securities in connection with an acquisition of Property to be held directly by the General Partner but if, and only if, such direct acquisition and issuance of Additional Securities have been approved and determined to be in the best interests of the General Partner and the Partnership by a majority of the Independent Directors. Without limiting the foregoing, the General Partner is expressly authorized to issue Additional Securities for less than fair market value, and to cause the Partnership to issue to the General Partner corresponding Partnership Interests, so long as (A) the General Partner concludes in good faith that such issuance is in the best interests of the General Partner and the Partnership, including without limitation, the issuance of REIT Shares and corresponding General Partner Units pursuant to an employee share purchase plan providing for employee purchases of REIT Shares at a discount from fair market value or employee stock options that have an exercise price that is less than the fair market value of the REIT Shares, either at the time of issuance or at the time of exercise or in order to comply with the REIT ownership requirements set forth in Section 856(a)(5) of the Code and (B) the General Partner contributes all proceeds from such issuance and exercise to the Partnership.

4.4.2    In connection with any and all issuances of REIT Shares or other securities of the General Partner, the General Partner shall make Capital Contributions to the Partnership of the proceeds from such issuances. If the proceeds actually received and contributed by the General Partner are less than the gross proceeds of such issuance as a result of any underwriter’s or broker-dealer’s discount or other fees or expenses paid or incurred in connection with such issuance (or as a result of sales net of commission or volume discounts), the General Partner may determine in its sole discretion whether it has made Capital Contributions to the Partnership in the aggregate amount of the gross proceeds of such issuance or the net amount contributed to the Partnership. In the event the General Partner determines it has made such a Capital Contribution of such excess amount, the Partnership shall be deemed simultaneously to have paid such offering expenses in accordance with Section 7.5 and in connection with the required issuance of additional Partnership Units or Preferred Units, as applicable, to the General Partner for such Capital Contributions pursuant to Section 4.3.

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4.4.3    In the event that the Partnership issues Partnership Interests pursuant to Sections 4.3 or 4.4, the General Partner shall make such revisions to this Agreement (without any requirement of receiving approval of any Limited Partner) as it deems necessary to reflect the issuance of such additional Partnership Interests and any special rights, powers, and duties associated therewith.

4.5    Additional Funding. If the General Partner determines that it is in the best interests of the Partnership to provide for additional Partnership funds for any Partnership purpose, the General Partner may (i) cause the Partnership to obtain such funds from outside borrowings or (ii) elect to have the General Partner or any of its Affiliates provide such funds to the Partnership through loans or otherwise.

4.6    Capital Accounts. A separate capital account (a “Capital Account”) shall be established and maintained for each Partner in accordance with Regulations Section 1.704-1(b)(2)(iv). If (i) a new or existing Partner acquires an additional Partnership Interest in exchange for more than a de minimis Capital Contribution, (ii) the Partnership distributes to a Partner more than a de minimis amount of Partnership property or money as consideration for a Partnership Interest, (iii) a new or existing Partner is granted an additional Partnership Interest (other than a de minimis interest) as consideration for the provision of services to or for the benefit of the Partnership in a partner capacity or in anticipation of becoming a Partner or (iv) the Partnership is liquidated within the meaning of Regulations Section 1.704-1(b)(2)(ii)(g), the General Partner shall revalue the Property of the Partnership to its fair market value (as determined by the General Partner, in its sole and absolute discretion, and taking into account Section 7701(g) of the Code) in accordance with Regulations Section 1.704-1(b)(2)(iv)(f). When the Partnership’s Property is revalued by the General Partner, the Capital Accounts of the Partners shall be adjusted in accordance with Regulations Sections 1.704-1(b)(2)(iv)(f) and (g), which generally require such Capital Accounts to be adjusted to reflect the manner in which the unrealized gain or loss inherent in such Property (that has not been reflected in the Capital Accounts previously) would be allocated among the Partners pursuant to Section 5.1 if there were a taxable disposition of such Property for its fair market value (as determined by the General Partner, in its sole and absolute discretion, and taking into account Section 7701(g) of the Code) on the date of the revaluation.

4.6.1    The Capital Account with respect to any Partner (or such Partner’s assignee) shall mean such Partner’s initial Capital Contribution adjusted as follows:

(a)    A Partner’s Capital Account shall be increased by:

(i)    such Partner’s share of Net Income;

(ii)    any item of income or gain specially allocated to a Partner and not included in Net Income or Net Loss;

(iii)    any additional cash Capital Contribution made by such Partner to the Partnership; and

(iv)    the fair market value of any additional Capital Contribution, as determined by the General Partner, consisting of property contributed by such Partner to the capital of the Partnership reduced by any liabilities assumed by the Partnership in connection with such contribution or to which the property is subject.

(b)    A Partner’s Capital Account shall be reduced by:

(i)    such Partner’s share of Net Loss;

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(ii)    any loss or deduction specially allocated to a Partner and not included in Net Income or Net Loss;

(iii)    any cash distribution made to such Partner; and

(iv)    the fair market value, as determined by the General Partner of any property (reduced by any liabilities assumed by the Partner in connection with the distribution or to which the distributed property is subject) distributed to such Partner; provided that, upon liquidation and winding up of the Partnership, unsold property will be valued for distribution at its fair market value and the Capital Account of each Partner before such distribution shall be adjusted to reflect the allocation of gain or loss that would have been realized had the Partnership then sold the property for its fair market value. Such fair market value shall not be less than the amount of any nonrecourse indebtedness that is secured by the property.

4.6.2    Notwithstanding anything to the contrary in this Agreement, the Capital Accounts shall be maintained in accordance with Regulations Section 1.704-1(b). For purposes of this Agreement, any references to the Regulations shall include corresponding subsequent provisions.

4.7    Percentage Interests. If (i) the number of outstanding Participating Partnership Units increases or decreases during a taxable year or (ii) the Percentage Interest of an LTIP Unit is otherwise adjusted because the LTIP Unit Distribution Participation Date or the Special LTIP Unit Full Participation Date has occurred as described in the definition of Percentage Interest, then each Partner’s Percentage Interest shall be adjusted by the General Partner effective as of the effective date of each such increase or decrease to a percentage equal to the number of Participating Partnership Units held by such Partner divided by the aggregate number of Participating Partnership Units outstanding after giving effect to such increase or decrease and shall be further adjusted to take into account any special calculations of Percentage Interests for outstanding LTIP Units described in the definition of Percentage Interests.

4.8    No Interest on Contributions. Except as may be specifically provided in this Agreement, no Partner shall be entitled to interest on its Capital Contributions.

4.9    Return of Capital Contributions. No Partner shall be entitled to withdraw any part of its Capital Contribution or its Capital Account or to receive any distribution from the Partnership, except as specifically provided in this Agreement. Except as otherwise provided herein, there shall be no obligation to return to any Partner or withdrawn Partner any part of such Partner’s Capital Contribution for so long as the Partnership continues in existence.

4.10    No Third Party Beneficiary. No creditor or other third party having dealings with the Partnership shall have the right to enforce the right or obligation of any Partner to make Capital Contributions or loans or to pursue any other right or remedy hereunder or at law or in equity, it being understood and agreed that the provisions of this Agreement shall be solely for the benefit of, and may be enforced solely by, the parties hereto and their respective successors and assigns. None of the rights or obligations of the Partners herein set forth to make Capital Contributions or loans to the Partnership shall be deemed an asset of the Partnership for any purpose by any creditor or other third party, nor may such rights or obligations be sold, transferred or assigned by the Partnership or pledged or encumbered by the Partnership to secure any debt or other obligation of the Partnership or of any of the Partners. In addition, it is the intent of the parties hereto that no distribution to any Limited Partner shall be deemed a return of money or other property in violation of the Act. However, if any court of competent jurisdiction holds that, notwithstanding the provisions of this Agreement, any Limited Partner is obligated to return such money or property, such obligation shall be the obligation of such Limited Partner and not of the General Partner. Without limiting the generality of the foregoing but except for any written agreement made between the Partner and the Partnership, a deficit Capital Account of a Partner shall not be deemed to be a

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liability of such Partner nor an asset or property of the Partnership and upon a liquidation within the meaning of Regulations Section 1.704-1(b)(2)(ii)(g), if any Partner has a deficit Capital Account (after giving effect to all contributions, distributions, allocations and other Capital Account adjustments for all taxable years, including the year during which such liquidation occurs), such Partner shall have no obligation to make any Capital Contribution to reduce or eliminate the negative balance of such Partner’s Capital Account.

4.11    Issuance of Common Warrants. The General Partner is hereby authorized to cause the Partnership to issue Common Warrants for any Partnership purpose at any time, or from time to time, to the Partners (including the General Partner) or to other Persons for such consideration and on such terms and conditions as shall be established by the General Partner in its sole and absolute discretion, all without the approval of any Limited Partner.

4.12    Issuance of Series 2019 Preferred Units. The General Partner is authorized to cause the Partnership to issue the Series 2019 Preferred Units to the General Partner according to the Partnership Unit Designation of the Series 2019 Preferred Units provided on Exhibit G.

5.    Net Income and Net Loss.

5.1    Allocation of Net Income and Net Loss. Net Income and Net Loss (or items thereof) of the Partnership for each fiscal year or other applicable period of the Partnership shall be allocated as follows:

5.1.1    To the Partners in a manner such that, after giving effect to the special allocations set forth in 5.2, 5.3, 5.4, 5.7, 5.9 and 5.10 and Section 8 of Exhibit G, is, as nearly as possible, equal to (i) the Distributions that would be made to such Partner pursuant to Section 6.1 if the Partnership were dissolved, its affairs wound-up and its assets sold for cash equal to their book value, all Partnership liabilities were satisfied (limited with respect to each nonrecourse liability to the book value of the assets security such liability), and the net assets of the Partnership were distributed in accordance with Section 6.7, to the Partners immediately after making such allocations, minus (ii) such Partner’s share of Partnership Minimum Gain and Partner Nonrecourse Debt Minimum Gain, computed immediately prior to the hypothetical sale of assets. Notwithstanding the foregoing, the General Partner may make such allocations as it deems reasonably necessary to give economic effect to the provisions of this Agreement taking into account such facts and circumstances as the Manager deems necessary for this purpose. To the extent that there have been distributions made pursuant to Section 6.1.1(a) and (b), a corresponding allocation of Net Income, and if there is any shortfall, a corresponding allocation of gross income to the General Partner will be made. This Agreement may be amended in the sole discretion of the General Partner to change the manner in which allocations of Net Income and Net Loss are made by the Partnership so long as such amendment is intended to reflect the allocation of Net Income and Net Loss to the Partners as set forth in this Agreement.

5.2    Nonrecourse Deductions; Minimum Gain Chargeback. Notwithstanding any provision to the contrary in this Agreement, (i) any expense of the Partnership that is a “nonrecourse deduction” within the meaning of Regulations Section 1.704-2(b)(1) shall be allocated in accordance with the Partners’ respective Percentage Interests, (ii) any expense of the Partnership that is a “partner nonrecourse deduction” within the meaning of Regulations Section 1.704-2(i)(2) shall be allocated to the Partner that bears the “economic risk of loss” with respect to the “partner nonrecourse debt” to which such partner nonrecourse deduction is attributable in accordance with Regulations Section 1.704-2(i)(1), (iii) if there is a net decrease in Partnership Minimum Gain within the meaning of Regulations Section 1.704-2(f)(1) for any Partnership taxable year, then, subject to the exceptions set forth in Regulations Section 1.704-2(f)(2),(3), (4) and (5), items of gain and income shall be allocated among the Partners in accordance with Regulations Section 1.704-2(f) and the ordering rules contained in Regulations Section 1.704-2(j) and

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(iv) if there is a net decrease in Partner Minimum Gain within the meaning of Regulations Section 1.704-2(i)(4) for any Partnership taxable year, then, subject to the exceptions set forth in Regulations Section 1.704-2(g), items of gain and income shall be allocated among the Partners in accordance with Regulations Section 1.704-2(i)(4) and the ordering rules contained in Regulations Section 1.704-2(j). A Partner’s “interest in partnership profits” for purposes of determining its share of the excess nonrecourse liabilities of the Partnership within the meaning of Regulations Section 1.752-3(a)(3) shall be such Partner’s Percentage Interest; provided, however, with respect to the Common Units issued, excess nonrecourse liability shall first be allocated to the Common Limited Partners who contributed the applicable property to the extent of any built-in gain with respect to such property that it is attributable to such Common Limited Partner pursuant to Section 704(c) to the extent debt attributable to such gain has not previously been allocated to such Common Limited Partner pursuant to Regulations Section 1.752-3(a)(2). Except as set forth immediately above, the General Partner may select the appropriate method for sharing excess nonrecourse liabilities.

5.3    Qualified Income Offset. If a Partner unexpectedly receives in any taxable year an adjustment, allocation, or distribution described in subparagraphs (4), (5) or (6) of Regulations Section 1.704-1(b)(2)(ii)(d) that causes or increases a deficit balance in such Partner’s Capital Account that exceeds the sum of such Partner’s shares of Partnership Minimum Gain and Partner Minimum Gain, as determined in accordance with Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5), such Partner shall be allocated specially for such taxable year (and, if necessary, later taxable years) items of income and gain in an amount and manner sufficient to eliminate such deficit Capital Account balance as quickly as possible as provided in Regulations Section 1.704-1(b)(2)(ii)(d). This Section 5.3 is intended to constitute a “qualified income offset” under Regulations Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith. After the occurrence of an allocation of income or gain to a Partner in accordance with this Section 5.3, to the extent permitted by Regulations Section 1.704-1(b), items of expense or loss shall be allocated to such Partner in an amount necessary to offset the income or gain previously allocated to such Partner under this Section 5.3.

5.4    Capital Account Deficits. Net Loss (or items of Net Loss) shall not be allocated to a Limited Partner to the extent that such allocation would cause or increase a deficit in such Partner’s Capital Account at the end of any fiscal year (after reduction to reflect the items described in Regulations Section 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) to exceed the sum of such Partner’s shares of Partnership Minimum Gain and Partner Minimum Gain, as determined in accordance with Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5). Any Net Loss in excess of that limitation shall be allocated to the General Partner. After the occurrence of an allocation of Net Loss to the General Partner in accordance with this Section 5.4, to the extent permitted by Regulations Section 1.704-1(b), Net Income shall be allocated to the General Partner in an amount necessary to offset the Net Loss previously allocated to the General Partner under this Section 5.4.

5.5    Allocations Between Transferor and Transferee. If a Partner Transfers any part or all of its Partnership Interest or the Partner’s Percentage Interest is adjusted pursuant to Section 4.7, the distributive shares of the various items of Net Income and Net Loss allocable among the Partners during such fiscal year of the Partnership shall be allocated between the transferor and the transferee Partner either (i) as if the Partnership’s fiscal year had ended on the date of the Transfer or (ii) based on the number of days of such fiscal year that each was a Partner without regard to the results of Partnership activities in the respective portions of such fiscal year in which the transferor and the transferee were Partners. The General Partner, in its sole and absolute discretion, shall determine which method shall be used to allocate the distributive shares of the various items of Net Income and Net Loss between the transferor and the transferee Partner for the taxable year in which the adjustment occurs. The allocation of Net Income and Net Loss for the earlier part of the year shall be based on the Percentage Interests before adjustment, and the allocation of Net Income and Net Loss for the later part shall be based on the adjusted Percentage Interests.

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5.6    Definition of Net Income and Net Loss. “Net Income” and “Net Loss” and any items of income, gain, expense, or loss referred to in this Agreement shall be determined in accordance with federal income tax accounting principles, as modified by Regulations Section 1.704-1(b)(2)(iv), except that Net Income and Net Loss shall not include items of income, gain and expense that are specially allocated pursuant to Sections 5.2, 5.3, 5.4, 5.7, 5.9, 5.10 and 5.11. All allocations of income, Net Income, gain, Net Loss and expense (and all items contained therein) for federal income tax purposes shall be identical to all allocations of such items set forth in this Section 5, except as otherwise required by Section 704(c) of the Code and Regulations Section 1.704-1(b)(4). The General Partner shall have the authority, in its sole discretion and without the need for consent from any Partner, to elect the method or methods to be used by the Partnership for allocating items of income, gain, expense and deductions as required by Section 704(c) of the Code including the election of a method that may result in one or more Partners receiving or being allocated a disproportionately larger share of items of Partnership income, gain, expense or deduction and any such election shall be binding on all Partners.

5.7    Curative Allocations. The allocations set forth in Sections 5.2, 5.3 and 5.4 of this Agreement (the “Regulatory Allocations”) are intended to comply with certain requirements of the Regulations. The General Partner is authorized to offset all Regulatory Allocations either with other Regulatory Allocations or with special allocations of other items of Partnership income, gain, loss or deduction pursuant to this Section 5.7. Therefore, notwithstanding any other provision of this Section 5 (other than the Regulatory Allocations), the General Partner shall make such offsetting special allocations of Partnership income, gain, loss or deduction in whatever manner it deems appropriate so that, after such offsetting allocations are made, each Partner’s Capital Account is, to the extent possible, equal to the Capital Account balance such Partner would have had if the Regulatory Allocations were not part of this Agreement and all Partnership items were allocated pursuant to Section 5.1.

5.8    Special Allocation. Notwithstanding the other provisions in this Section (but subject to Sections 5.11 and 5.12), in the year of the sale of the last Property, Net Income and Net Loss from all sources (or gross income or gross expense) shall be allocated, to the greatest extent possible, so that the positive Capital Account balance of each Partner shall be equal to the distributions to be made to the Partners, provided, however, that in no event shall this Section 5.8 be interpreted or applied in a manner that would cause any LTIP Unit to fail to qualify as a “profits interest” under IRS Revenue Procedure 93-27, 1993-2 C.B. 343 (June 9, 1993) and IRS Revenue Procedure 2001-43, 2001-2 C.B. 191 (August 3, 2001) (for example, this Section 5.8 shall not cause an LTIP Unit Limited Partner to receive a gross income allocation with respect to an LTIP Unit, or other Partners to receive gross expense allocations, if such allocation(s) would result in a reduction of the LTIP Unit Limited Partner’s Book-Up Target with respect to its LTIP Unit in excess of the amount by which such Book-Up Target would have been reduced in the absence of this Section 5.8). This Section 5.8 shall be interpreted in a manner consistent with the Partnership’s intention to treat the LTIP Units as “profits interests” for U.S. federal income tax purposes.

5.9    Preferred Interest Designation. Notwithstanding any provisions to the contrary in this Agreement, Net Income and Net Loss shall first be allocated to Partners as set forth in the Partnership Unit Designations.

5.10    Forfeiture Allocations. Subject to Section 5.11.3 with respect to a forfeiture of certain LTIP Units, upon a forfeiture of any unvested Partnership Interest by any Partner, gross items of income, gain, loss or deduction shall be allocated to such Partner if and to the extent required by final Regulations promulgated after the effective date of this Agreement to ensure that allocations made with respect to all unvested Partnership Interests are recognized under Code Section 704(b).

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5.11    LTIP Allocation Provisions.

5.11.1    For purposes of determining allocations of Net Loss pursuant to Section 5.1, an LTIP Unit Limited Partner shall be treated as having a separate Economic Capital Account Balance, and for this purpose a separate Capital Account with an appropriate share of Partnership Minimum Gain and Partner Minimum Gain shall be maintained, for each tranche of LTIP Units with a different issuance date that it holds and a separate Capital Account for its Common Units, if applicable, and the Economic Capital Account Balance of each holder of Common Units shall not include any Economic Capital Account Balance attributable to other series or classes of Partnership Units.

5.11.2    After giving effect to the special allocations set forth in Sections 5.2, 5.3, 5.4, 5.7, 5.9 and 5.10, and the allocations of Net Income under Sections 5.1.1(a), and subject to the other provisions of this Section 5, but before allocations of Net Income are made under Section 5.1.1(b) or 5.1.1(c), Liquidating Gains and Liquidating Losses shall be allocated as follows:

(a)    Liquidating Gains (including, for the avoidance of doubt, Liquidating Gains that are a component of any remaining Net Income), shall first be allocated to LTIP Unit Limited Partners until the Economic Capital Account Balances of such Partners, to the extent attributable to their ownership of LTIP Units, are equal to (i) the Common Unit Economic Balance, multiplied by (ii) the number of their LTIP Units (with respect to each LTIP Unit Limited Partner, the “Target Balance”), provided, however, that no such Liquidating Gains will be allocated with respect to any particular LTIP Unit (each an “Ineligible Unit”) if and to the extent that cumulative Liquidating Losses of the Partnership have exceeded cumulative Liquidating Gains of the Partnership during the period from the issuance of such LTIP Unit through the date of such allocation. If, notwithstanding the foregoing, not all LTIP Units (including Ineligible Units) are fully booked up, Liquidating Gains shall be allocated, subject to Section 5.11.2(b), among LTIP Unit Limited Partners with respect to their LTIP Units in a manner reasonably determined by the General Partner. For the avoidance of doubt, Liquidating Gains allocated with respect to an LTIP Unit pursuant to this Section 5.11.2(a) shall reduce (but not below zero) the Book-Up Target for such LTIP Unit.

(b)    Liquidating Gain allocated to an LTIP Unit Limited Partner under this Section 5.11 will be attributed to specific LTIP Units of such LTIP Unit Limited Partner for purposes of determining (i) allocations under this Section 5.11, (ii) the effect of the forfeiture or conversion of specific LTIP Units on such LTIP Unit Limited Partner’s Capital Account and (iii) the ability of such LTIP Unit Limited Partner to convert specific LTIP Units into Common Units. Such Liquidating Gain will generally be attributed in the following order: (A) first, to Vested LTIP Units held for more than two years, (B) second, to Vested LTIP Units held for two years or less, (C) third, to Unvested LTIP Units that have remaining vesting conditions that only require continued employment or service to the General Partner, the Partnership or an Affiliate of either for a certain period of time (with such Liquidating Gains being attributed in order of vesting from soonest vesting to latest vesting) and (D) fourth, to other Unvested LTIP Units (with such Liquidating Gains being attributed in order of issuance from earliest issued to latest issued). Within each category, Liquidating Gain will be allocated seriatim (i.e., entirely to the first unit in a set, then entirely to the next unit in the set, and so on, until a full allocation is made to the last unit in the set) in the order of smallest Book-Up Target to largest Book-Up Target. Any such allocations shall be made among the holders of LTIP Units in proportion to the aggregate amounts required to be allocated to each under this Section 5.

(c)    After giving effect to the special allocations set forth above in this Section 5.11, if, due to distributions with respect to Common Units in which the LTIP Units do not participate, forfeitures or otherwise, the Economic Capital Account Balance of any LTIP Unit Limited Partner attributable to such LTIP Unit Limited Partner’s LTIP Units, exceeds the Target Balance, then

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Liquidating Losses shall be allocated to such LTIP Unit Limited Partner, or, at the election of the General Partner, Liquidating Gains shall be allocated to the other Partners, to eliminate the disparity; provided, however, that if Liquidating Losses and Liquidating Gains are insufficient to completely eliminate all such disparities, such losses or gains shall be allocated among Partners in a manner reasonably determined by the General Partner.

(d)    The parties agree that the intent of this Section 5.11 is (i) to the extent possible to make the Capital Account balance associated with each LTIP Unit economically equivalent to the Capital Account balance associated with the General Partner’s General Partner Units (on a per-unit basis) and (ii) to allow conversion of an LTIP Unit (assuming prior vesting) when sufficient Liquidating Gains have been allocated to such LTIP Unit pursuant to Section 5.11 so that either an LTIP Unit’s initial Book-Up Target has been reduced to zero or the parity described in clause (i) above has been achieved. The General Partner shall be permitted to interpret this Agreement (including this Section 5.11) and to amend this Agreement to the extent necessary and consistent with this intention.

(e)    In the event that Liquidating Gains or Liquidating Losses are allocated under this Section 5.11, Net Income allocable under Sections 5.1.1(b) and 5.1.1(c) and any Net Loss shall be recomputed without regard to the Liquidating Gains or Liquidating Losses so allocated.

5.11.3    If an LTIP Unit Limited Partner forfeits any LTIP Units to which Liquidating Gain has previously been allocated under Section 5.11.2, (i) the portion of such LTIP Unit Limited Partner’s Capital Account attributable to such Liquidating Gain allocated to such forfeited LTIP Units will be re-allocated to that LTIP Unit Limited Partner’s remaining LTIP Units that were outstanding on the date of the initial allocation of such Liquidating Gain (if any), using a methodology similar to that described in Section 5.11.2 as reasonably determined by the General Partner, to the extent necessary to cause such LTIP Unit Limited Partner’s Economic Capital Account Balance attributable to each such LTIP Unit to equal the Common Unit Economic Balance and (ii) such LTIP Unit Limited Partner’s Capital Account will be reduced by the amount of any such Liquidating Gain not re-allocated pursuant to clause (i) above.

5.11.4    Notwithstanding the other provisions in this Agreement, any Person who is allocated LTIP Units on or before March 31, 2020 shall also receive a special Distribution and allocation of income in 2020 equal to the Distributions that such Person would have received if they had held such LTIP Units beginning on January 1, 2020 and continuing through the date of grant of such LTIP Units.

5.12    Substantial Economic Effect. It is the intent of the Partners that the allocations of Net Income and Net Loss under this Agreement have substantial economic effect (or be consistent with the Partners’ interests in the Partnership in the case of the allocation of losses attributable to nonrecourse debt) within the meaning of Section 704(b) of the Code as interpreted by the Regulations promulgated pursuant thereto. Section 5 and other relevant provisions of this Agreement shall be interpreted in a manner consistent with such intent. If the Partnership is advised by the Partnership’s legal counsel that the allocations provided in this Agreement are unlikely to be respected for federal income tax purposes, the General Partner is hereby granted the power to amend the allocation provisions of this Agreement to the minimum extent necessary to comply with Section 704(b) of the Code and effect the plan of allocations and distributions provided for in this Agreement. The Limited Partners acknowledge and agree that counsel representing the Partnership, the General Partner, the advisor to the General Partner and their Affiliates does not represent and will not be deemed under the applicable codes of professional responsibility to have represented or to be representing any or all of the Limited Partners in any respect.

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6.    Distributions.

6.1    Distribution of Cash.

6.1.1    Unless otherwise provided herein, Cash from Operations shall be distributed to the Partners as follows:

(a)    The Partnership shall first make distributions as set forth in the Partnership Unit Designations;

(b)    Second, 100% to the General Partner until the Stockholders have received Distributions in an aggregate amount equal to the sum of the (i) Stockholders’ 6% Return and (ii) Stockholders’ Invested Capital;

(c)    After making the distributions set forth in Section 6.1.1(a) and (b), the Partnership shall distribute cash on a monthly (or, at the election of the General Partner, more or less frequent) basis, in an amount determined by the General Partner in its sole and absolute discretion, 85% to the Common Limited Partners, LTIP Unit Limited Partners and General Partner in proportion to their Percentage Interests and 15% to the Special Limited Partner. Distributions made pursuant to this Section 6.1.1 shall be adjusted as necessary to ensure that the amount apportioned to each LTIP Unit does not exceed the amount attributable to items of Partnership income or gain realized after the date such LTIP Unit was issued by the Partnership. The intent of the immediately preceding sentence is to ensure that any LTIP Units qualify as “profits interests” under Revenue Procedure 93-27, 1993-2 C.B. 343 (June 9, 1993) and Revenue Procedure 2001-43, 2001-2 C.B. 191 (August 3, 2001), and such sentence shall be interpreted and applied consistently therewith. The General Partner at its discretion may amend this Section 6.1.1 to ensure that any LTIP Units will qualify as “profits interests” under Revenue Procedure 93-27, 1993-2 C.B. 343 (June 9, 1993) and Revenue Procedure 2001-43, 2001-2 C.B. 191 (August 3, 2001) (and any other similar rulings or regulations that may be in effect at such time).

6.1.2    The Partnership shall distribute to the Partners who are Partners on the Partnership Record Date with respect to such month (or other distribution period) in accordance with Section 6.1.1; provided, however, that if a new or existing Partner acquires an additional Partnership Interest in exchange for a Capital Contribution on any date other than the day after the Partnership Record Date, the cash distribution attributable to such additional Partnership Interest relating to the Partnership Record Date next following the issuance of such additional Partnership Interest shall be adjusted in proportion to (i) the number of days that such additional Partnership Interest is held by such Partner bears to (ii) the number of days between such Partnership Record Date and the immediately preceding Partnership Record Date.

6.1.3    Except for distributions pursuant to Section 6.7 of this Agreement in connection with the dissolution and liquidation of the Partnership and subject to the provisions of Sections 6.1.1, 6.2, 6.3, 6.4 and 6.6 of this Agreement, distributions shall be made to the holders of Participating Partnership Units in accordance with their respective Percentage Interests.

6.1.4    In no event may a Partner receive a distribution of cash with respect to a Partnership Unit if such Partner is entitled to receive a cash distribution as the holder of record of a REIT Share for which all or part of such Partnership Unit has been or will be exchanged.

6.2    Withholding. Notwithstanding any other provision of this Agreement, the General Partner is authorized to take any action that it determines to be necessary or appropriate to cause the Partnership to comply with any withholding requirements established under the Code or any other federal, state or local law including, without limitation, the requirements of Sections 1441, 1442, 1445 and 1446

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of the Code. To the extent that the Partnership is required to withhold and pay over to any taxing authority any amount resulting from the allocation or distribution of income to any Partner or assignee (including by reason of Section 1446 of the Code), either (i) if the actual amount to be distributed to the Partner equals or exceeds the amount required to be withheld by the Partnership, the amount withheld shall be treated as a distribution of cash in the amount of such withholding to such Partner or assignee or (ii) if the actual amount to be distributed to the Partner or assignee is less than the amount required to be withheld by the Partnership, the actual amount shall be treated as a distribution of cash in the amount of such withholding and the additional amount required to be withheld shall be treated as a loan (a “Partnership Loan”) from the Partnership to the Partner or assignee on the day the Partnership pays over such amount to a taxing authority. A Partnership Loan shall be repaid through withholding by the Partnership with respect to subsequent distributions to the applicable Partner or assignee or upon demand upon the applicable Partner or assignee. In the event that a Limited Partner fails to pay any amount owed to the Partnership with respect to the Partnership Loan within 15 days after demand for payment thereof is made by the Partnership on the Limited Partner (a “Defaulting Limited Partner”), the General Partner, in its sole and absolute discretion, may elect to make the payment to the Partnership on behalf of such Defaulting Limited Partner. In such event, on the date of payment, the General Partner shall be deemed to have extended a loan (a “General Partner Loan”) to the Defaulting Limited Partner in the amount of the payment made by the General Partner and shall succeed to all rights and remedies of the Partnership against the Defaulting Limited Partner as to that amount. Without limitation, the General Partner shall have the right to receive any distributions that otherwise would be made by the Partnership to the Defaulting Limited Partner until such time as the General Partner Loan has been paid in full, and any such distributions so received by the General Partner shall be treated as having been received by the Defaulting Limited Partner and immediately paid to the General Partner. Any amounts treated as a Partnership Loan or a General Partner Loan pursuant to this Section 6.2 shall bear interest at the lesser of (A) the base rate on corporate loans at large United States money center commercial banks, as published from time to time in The Wall Street Journal or (B) the maximum lawful rate of interest on such obligation, such interest to accrue from the date the Partnership or the General Partner, as applicable, is deemed to extend the loan until such loan is repaid in full.

6.3    Tax Distribution. Notwithstanding the provisions set forth in Section 6.1.1, but subject to Section 6.4, the Partnership may, at the option of the General Partner, make distributions to the Special Limited Partner prior to making the distributions set forth in Section 6.1.1(b), to the extent such distributions are needed to pay any income taxes associated with the allocations of Net Income to the Special Limited Partner prior to any distributions under Section 6.1.1(c). Any such distributions shall reduce subsequent distributions to be made to the Special Limited Partner pursuant to Section 6.1.1. In no event shall the General Partner make any tax distributions to the Special Limited Partner as permitted under this Section 6.3 if such distributions are necessary for the General Partner to meet the distribution requirements for qualification as a REIT.

6.4    REIT Distribution Requirements. The General Partner shall use its commercially reasonable efforts to cause the Partnership to distribute amounts sufficient to enable the General Partner to make distributions to its stockholders that will allow the General Partner to (i) meet its distribution requirement for qualification as a REIT as set forth in Section 857 of the Code and (ii) avoid any federal income or excise tax liability imposed by the Code, other than to the extent the General Partner elects to retain and pay income tax on its net capital gain.

6.5    No Right to Distributions in Kind. No Partner shall be entitled to demand Property other than cash in connection with any distributions by the Partnership.

6.6    Limitations on Return of Capital Contributions. Notwithstanding any of the provisions of this Section 6, no Partner shall have the right to receive and the General Partner shall not have the right to

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make, a distribution that includes a return of all or part of a Partner’s Capital Contributions, unless after giving effect to the return of a Capital Contribution, the sum of all Partnership liabilities, other than the liabilities to a Partner for the return of its Capital Contribution, does not exceed the fair market value of the Partnership’s assets.

6.7    Distributions Upon Liquidation. Upon liquidation of the Partnership, after payment of, or adequate provision for, debts and obligations of the Partnership, including any Partner loans and any distributions required pursuant to the Partnership Unit Designations, any remaining assets of the Partnership shall be distributed to the Common Limited Partners, Special Limited Partner, LTIP Unit Limited Partners and General Partner as set forth in Section 6.1, which is intended to be in accordance with the positive balance of the Capital Account of each Partner; provided, however, that, notwithstanding the foregoing, consistent with the Partnership’s intention to treat LTIP Units as “profits interests” under Revenue Procedure 93-27, 1993-2 C.B. 343 (June 9, 1993) and Revenue Procedure 2001-43, 2001-2 C.B. 191 (August 3, 2001), in no event shall an LTIP Unit Limited Partner receive any distribution pursuant to this Section 6.7 with respect to an LTIP Unit in excess of such LTIP Unit Limited Partner’s positive Capital Account balance with respect to such LTIP Unit. For purposes of the preceding sentence, the Capital Account of each Partner shall be determined after all allocations and distributions have been made in accordance with this Agreement attributable to Partnership operations and from all sales and dispositions of all or any part of the Partnership’s assets.

To the extent deemed advisable by the General Partner, appropriate arrangements (including the use of a liquidating trust) may be made to assure that adequate funds are available to pay any contingent debts or obligations.

7.    Rights, Obligations and Powers of the General Partner.

7.1    Management of the Partnership.

7.1.1    Except as otherwise expressly provided in this Agreement, the General Partner shall have full, complete and exclusive discretion to manage and control the business of the Partnership for the purposes herein stated, and shall make all decisions affecting the business and assets of the Partnership. Subject to the restrictions specifically contained in this Agreement, the powers of the General Partner shall include, without limitation, the authority to take the following actions as deemed necessary or desirable in the sole and absolute discretion of the General Partner, on behalf of the Partnership (or any Subsidiary or GP Subsidiary):

(a)    to acquire, purchase, own, operate, manage, lease, dispose of and exchange any Property and any other assets in the best interests of the business of the Partnership;

(b)    to develop land, construct buildings and make other improvements or renovations on Property owned or leased by the Partnership;

(c)    to authorize, issue, sell, redeem or otherwise purchase any Partnership Interests or any securities (including secured and unsecured debt obligations of the Partnership, debt obligations of the Partnership convertible into any class or series of Partnership Interests or options, warrants, convertible or exchangeable securities or other rights relating to any Partnership Interests) of the Partnership;

(d)    to borrow money for the Partnership, issue evidences of indebtedness in connection therewith, refinance, increase the amount of, modify, amend or change the terms of, or extend the time for the payment of, any such indebtedness, and secure such indebtedness by mortgage, deed of trust, pledge or other lien on the Partnership’s assets;

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(e)    to make loans or advances to any Person, including Affiliates of the General Partner or the Partnership, for any purpose pertaining to the business of the Partnership;

(f)    to guarantee or become a co-maker of indebtedness of the General Partner or any Subsidiary thereof, refinance, increase the amount of, modify, amend or change the terms of, or extend the time for the payment of, any such guarantee or indebtedness, and secure such guarantee or indebtedness by mortgage, deed of trust, pledge or other lien on the Partnership’s assets;

(g)    to pay, either directly or by reimbursement, all Administrative Expenses to third parties or to the General Partner or its Affiliates as set forth in this Agreement;

(h)    to use assets of the Partnership for any purpose consistent with this Agreement, including, without limitation, payment, either directly or by reimbursement, of all Administrative Expenses of the General Partner, the Partnership or any Subsidiary of either, to third parties or to the General Partner as set forth in this Agreement;

(i)    to lease all or any portion of any of the Partnership’s assets, whether or not the terms of such leases extend beyond the termination date of the Partnership and whether or not any portion of the Partnership’s assets so leased are to be occupied by the lessee, or, in turn, subleased in whole or in part to others, for such consideration and on such terms as the General Partner may determine;

(j)    to prosecute, defend, arbitrate or compromise any and all claims or liabilities in favor of or against the Partnership, on such terms and in such manner as the General Partner may reasonably determine, and similarly to prosecute, settle or defend litigation with respect to the Partners, the Partnership or the Partnership’s assets;

(k)    to file applications, communicate and otherwise deal with any and all governmental agencies having jurisdiction over, or in any way affecting, the Partnership’s assets or any other aspect of the Partnership business;

(l)    to make or revoke any election permitted or required of the Partnership by any taxing authority;

(m)    to maintain such insurance coverage for public liability, fire and casualty, and any and all other insurance for the protection of the Partnership, conservation of Partnership assets, or any other purpose convenient or beneficial to the Partnership, in such amounts and such types, as it shall determine from time to time;

(n)    to determine whether or not to apply any insurance proceeds for any Property to the restoration of such Property, to distribute the same or to use such proceeds for other Partnership purposes;

(o)    to hire and dismiss employees of the Partnership, and to retain legal counsel, accountants, consultants, real estate brokers, and such other persons in connection with the Partnership business and to pay such remuneration as the General Partner may deem reasonable and proper;

(p)    to retain other services of any kind or nature in connection with the Partnership business, and to pay such remuneration as the General Partner may deem reasonable and proper;

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(q)    to negotiate and enter into agreements on behalf of the Partnership with respect to any of the rights, powers or authority of the General Partner;

(r)    to maintain accounting records and to file all federal, state and local income tax returns on behalf of the Partnership;

(s)    to distribute Partnership cash or other Partnership assets in accordance with this Agreement;

(t)    to form or acquire an interest in, and contribute Property to, any limited or general partnership, joint venture, limited liability company, corporation, Subsidiary or other entity or relationship;

(u)    to establish Partnership reserves for working capital, capital expenditures, contingent liabilities or any other Partnership purpose;

(v)    to merge, consolidate or combine the Partnership with or into another entity;

(w)    to take any and all actions necessary to adopt or modify any distribution reinvestment plan of the Partnership or the General Partner;

(x)    to do any and all acts necessary or desirable to ensure that the Partnership will not be classified as a “publicly traded partnership” for purposes of Section 7704 of the Code and the Regulations promulgated thereunder; and

(y)    to execute, acknowledge, swear to or deliver such other documents and instruments, and perform any and all acts for the formation, continuation and conduct of the business and affairs of the Partnership (including, without limitation, all actions consistent with allowing the General Partner at all times to qualify as a REIT unless the General Partner voluntarily terminates its REIT status) and to possess and maintain all of the rights and powers of a general partner as provided by the Act.

7.1.2    Except as otherwise provided herein, to the extent the duties of the General Partner require expenditures of funds to be paid to third parties, the General Partner shall not have any obligations hereunder except to the extent that Partnership funds are reasonably available to it for the performance of such duties, and nothing herein contained shall be deemed to authorize or require the General Partner, in its capacity as such, to expend its individual funds for payment to third parties or to undertake any individual liability or obligation on behalf of the Partnership.

7.2    Delegation of Authority. The General Partner may delegate any or all of its powers, rights and obligations hereunder, and may appoint, employ, contract or otherwise deal with any Person for the transaction of the business of the Partnership, which Person may, under supervision of the General Partner, perform any acts or services for the Partnership as the General Partner may approve.

7.3    Indemnification and Exculpation of Covered Persons.

7.3.1    The Partnership shall indemnify, to the fullest extent allowed under applicable law, a Covered Person from and against any and all losses, claims, damages, liabilities (whether joint or several), expenses (including reasonable legal fees and expenses), judgments, fines, settlements and other amounts arising from any and all claims, demands, actions, suits or proceedings (whether civil, criminal, administrative or investigative), that relate to the operations of the Partnership as set forth in this Agreement or relate to the provision of services to the Partnership in which any Covered Person may be

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involved, or is threatened to be involved, as a party or otherwise, unless it is established that (i) the act or omission of the Covered Person was material to the matter giving rise to the proceeding and either was committed in bad faith or was the result of active and deliberate dishonesty, (ii) the Covered Person actually received an improper personal benefit in money, property or services, (iii) in the case of any criminal proceeding, the Covered Person had reasonable cause to believe that the act or omission was unlawful or (iv) the Covered Person acted with gross negligence or willful misconduct.

7.3.2    The Partnership shall pay or reimburse a Covered Person for reasonable expenses and other costs incurred by a Covered Person who is a party to a proceeding in advance of the final disposition of the proceeding upon receipt by the Partnership of (i) a written affirmation by the Covered Person of the Covered Person’s good faith belief that the standard of conduct necessary for indemnification by the Partnership as authorized in this Section 7.3 has been met and (ii) a written undertaking by or on behalf of the Covered Person to repay the amount if it shall ultimately be determined that the Covered Person was not entitled to indemnification pursuant to this Section 7.3.

7.3.3    The Partnership may purchase and maintain insurance on behalf of the Covered Persons and such other Persons as the General Partner shall determine against any liability that may be asserted against or expenses that may be incurred by such Person in connection with the Partnership’s activities, regardless of whether the Partnership would have the power to indemnify such Person against such liability under the provisions of this Agreement.

7.3.4    For purposes of this Section 7.3, (i) the Partnership shall be deemed to have requested a Covered Person to serve as a fiduciary of an employee benefit plan whenever the performance by the Covered Person of its duties to the Partnership also imposes duties on the Covered Person, or otherwise involves services by the Covered Person to the plan or participants or beneficiaries of the plan, (ii) excise taxes assessed on a Covered Person with respect to an employee benefit plan pursuant to applicable law shall constitute fines within the meaning of this Section 7.3 and (iii) actions taken or omitted by the Covered Person with respect to an employee benefit plan in the performance of its duties for a purpose reasonably believed by it to be in the interest of the participants and beneficiaries of the plan shall be deemed to be for a purpose which is not opposed to the best interests of the Partnership.

7.3.5    In no event may a Covered Person subject the Partners to personal liability by reason of the indemnification provisions set forth in this Agreement.

7.3.6    A Covered Person shall not be denied indemnification in whole or in part under this Section 7.3 because the Covered Person had an interest in the transaction with respect to which the indemnification applies if the transaction was otherwise permitted by the terms of this Agreement or approved by the Board of Directors.

7.3.7    Notwithstanding the above provisions in this Section 7.3, the Partnership shall not provide indemnification for any loss, liability or expense arising from or out of an alleged violation of federal or state securities laws by such party unless (i) there has been a successful adjudication on the merits of each count involving alleged material securities law violations as to the Covered Person, (ii) such claims have been dismissed with prejudice on the merits by a court of competent jurisdiction as to the Covered Person or (iii) a court of competent jurisdiction approves a settlement of the claims against the Covered Person and finds that indemnification of the settlement and the related costs should be made, and the court considering the request for indemnification has been advised of the position of the Commission and of the published position of any state securities regulatory authority in which securities were offered or sold as to indemnification for violations of securities laws.

7.3.8    Without limitation, the foregoing indemnity shall extend to any liability of any Covered Person, pursuant to a loan guaranty or otherwise for any indebtedness of the Partnership or any

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Subsidiary of the Partnership (including without limitation, any indebtedness which the Partnership or any Subsidiary of the Partnership has assumed or taken subject to), and the General Partner is hereby authorized and empowered, on behalf of the Partnership, to enter into one or more indemnity agreements consistent with the provisions of this Section 7.3 in favor of any Covered Person having or potentially having liability for any such indebtedness.

7.3.9    The provisions of this Section 7.3 are for the benefit of the Covered Persons, their heirs, successors, assigns and administrators and shall not be deemed to create any rights for the benefit of any other Persons.

7.3.10    The indemnification provided by this Section 7.3 shall be in addition to any other rights to which a Covered Person or any other Person may be entitled under any agreement, pursuant to any vote of the Partners, as a matter of law or otherwise, and shall continue as to a Covered Person who has ceased to serve in such capacity.

7.3.11    Neither the amendment nor repeal of this Section 7.3, nor the adoption or amendment of any other provision of this Agreement inconsistent with this Section 7.3, shall apply to or affect in any respect the applicability of this Section 7.3 with respect to any act or failure to act which occurred prior to such amendment, repeal or adoption.

7.3.12    None of the Partners or any of their Affiliates shall have any obligation to cause the Partnership to take any action that would result in personal liability to any Limited Partner, its principals or any of its Affiliates in their capacity as obligator or guarantor of any loan that is obtained or assumed by the Partnership, notwithstanding that the failure to take any such action might result in the total or partial loss of the Partnership’s interest in some or all of the Partnership’s Property. Such action may include transferring property to a lender pursuant to a deed in lieu of foreclosure. Any action or inaction by the Partners or any of their Affiliates that is intended to avoid personal liability under any obligation or guaranty related to a loan that is obtained or assumed by the Partnership shall not constitute a breach of any fiduciary or other duty that the General Partner or its Affiliates may owe the Partnership. Further, the Partnership shall indemnify and hold harmless any Partners and their Affiliates for any guarantees either actual guarantees or non-recourse carve-out guarantees or similar guarantees.

7.3.13    The Partners acknowledge that the Limited Partners shall not be in breach of any duty or obligation that the Limited Partners or their Affiliates may have to the Partnership or the Partners if the Limited Partners vote their Limited Partner Interests in their own best interest with respect to any matter upon which the Limited Partners have the right to vote.

7.4    Liability of the General Partner.

7.4.1    Notwithstanding anything to the contrary set forth in this Agreement, the Covered Persons shall not be liable for monetary damages to the Partnership or any Partners for losses sustained or liabilities incurred as a result of errors in judgment or of any act or omission if the Covered Person acted in good faith. The Covered Person shall not be in breach of any duty that the Covered Person may owe to the Partners or the Partnership or any other Persons under this Agreement or of any duty stated or implied by law or equity provided the Covered Person, acting in good faith, abides by the terms of this Agreement.

7.4.2    In addition, to the extent the Covered Person performs its duties in accordance with the standards provided by the Act, such Person or Persons shall have no liability by reason of being or having been the General Partner, or by reason of being an officer, director, employee, agent or stockholder of the General Partner. To the maximum extent that the Act and the general laws of the State of Delaware, in effect from time to time, permit limitation of the liability of general partners of a limited

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partnership, the Covered Person shall not be liable to the Partnership or to any Partner for money damages except to the extent that (i) the Covered Person actually received an improper benefit or profit in money, property or services, in which case the liability shall not exceed the amount of the benefit or profit in money, property or services actually received or (ii) a judgment or other final adjudication adverse to the Covered Person is entered in a proceeding based on a finding in the proceeding that the action or failure to act of the Covered Person was the result of active and deliberate dishonesty and was material to the cause of action adjudicated in the proceeding.

7.4.3    The Limited Partners expressly acknowledge that (i) the General Partner is acting on behalf of the Partnership, itself and its stockholders collectively and (ii) the General Partner is under no obligation to consider the separate interests of the Limited Partners (including, without limitation, the tax consequences to the Limited Partners or some, but not all, of the Limited Partners) in deciding whether to cause the Partnership to take (or decline to take) any actions. The General Partner shall not be liable for monetary damages for losses sustained, liabilities incurred, or benefits not derived by Limited Partners in connection with such decisions, provided that the General Partner has acted in good faith.

7.4.4    Notwithstanding any other provisions of this Agreement or the Act, any action of the General Partner on behalf of the Partnership or any decision of the General Partner to refrain from acting on behalf of the Partnership, undertaken in the good faith belief, that such action or omission is necessary or advisable in order to (i) protect the ability of the General Partner to continue to qualify as a REIT or (ii) prevent the General Partner from incurring any taxes under Section 857, Section 4981 or any other provision of the Code, is expressly authorized under this Agreement and is deemed approved by all of the Limited Partners.

7.4.5    Subject to its obligations and duties as General Partner set forth in Section 7.1, the General Partner may exercise any of the powers granted to it under this Agreement and perform any of the duties imposed upon it hereunder either directly or by or through its employees and agents. The General Partner shall not be responsible for any misconduct or negligence on the part of any such employee or agent appointed by the General Partner in good faith.

7.4.6    To the extent that, at law or in equity, a Covered Person has duties and liabilities relating thereto to the Partnership or to the Partners, any Covered Person acting under this Agreement or otherwise shall not be liable to the Partnership or to any Partner for its good faith reliance on the provisions of this Agreement. The provisions of this Agreement, to the extent that they restrict the duties and liabilities of a Covered Person otherwise existing at law or in equity, are agreed by the Partners to replace such other duties and liabilities of such Covered Person.

7.4.7    Whenever in this Agreement the General Partner is permitted or required to make a decision (i) in its “sole discretion” or “discretion,” or under a similar grant of authority or latitude, the General Partner shall be entitled to consider such interests and factors as it desires and may consider its own interests, and shall have no duty or obligation to give any consideration to any interest of or factors affecting the Partnership or the other Partners or (ii) in its “good faith” or under another express standard, the General Partner shall act under such express standard and shall not be subject to any other or different standards imposed by this Agreement or by law or in equity or any other agreement contemplated herein or otherwise.

7.4.8    The General Partner may rely and shall be protected in acting, or refraining from acting, upon any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, bond, debenture, or other paper or document believed by it in good faith to be genuine and to have been signed or presented by the proper party or parties.

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7.4.9    The General Partner may consult with legal counsel, accountants, appraisers, management consultants, investment bankers, architects, engineers, environmental consultants and other consultants and advisers selected by it, and any act taken or omitted to be taken in reliance upon the opinion of such Persons as to matters which the General Partner reasonably believes to be within such Person’s professional or expert competence shall be conclusively presumed to have been done or omitted in good faith and in accordance with such opinion.

7.4.10    The General Partner shall have the right, in respect of any of its powers or obligations hereunder, to act through any of its duly authorized officers and duly appointed attorneys-in-fact. Each such attorney shall, to the extent provided by the General Partner in the power of attorney, have full power and authority to do and perform each and every act and duty which is permitted or required to be done by the General Partner hereunder.

7.4.11    Neither the amendment nor repeal of this Section 7.4, nor the adoption or amendment of any other provision of this Agreement inconsistent with this Section 7.4, shall apply to or affect in any respect the applicability of this Section 7.4 with respect to any act or failure to act which occurred prior to such amendment, repeal or adoption.

7.5    Reimbursement of General Partner.

7.5.1    Except as provided in this Section 7.5 and elsewhere in this Agreement (including Sections 5 and 6), the General Partner shall not be compensated for its services as general partner of the Partnership.

7.5.2    REIT Expenses and Administrative Expenses shall be obligations of the Partnership and the General Partner shall be entitled to reimbursement for all REIT Expenses and Administrative Expenses incurred by the General Partner on behalf of the Partnership. Reimbursement of REIT Expenses and Administrative Expenses shall be treated as an expense of the Partnership and not as allocations of Partnership income or gain.

7.6    Outside Activities. Subject to Section 7.8, the Articles of Incorporation and any agreements entered into by the General Partner or its Affiliates with the Partnership or a Subsidiary, or any officer, director, employee, agent, trustee, Affiliate or stockholder of the General Partner, the General Partner shall be entitled to and may have business interests and engage in business activities in addition to those relating to the Partnership, including business interests and activities substantially similar or identical to those of the Partnership. Neither the Partnership nor any of the Limited Partners shall have any rights by virtue of this Agreement in any such business ventures, interests or activities. None of the Limited Partners or any other Person shall have any rights by virtue of this Agreement or the partnership relationship established hereby in any such business ventures, interests or activities, and the General Partner shall have no obligation pursuant to this Agreement to offer any interest in any such business ventures, interests and activities to the Partnership or any Limited Partner, even if such opportunity is of a character which, if presented to the Partnership or any Limited Partner, could be taken by such Person.

7.7    Employment or Retention of Affiliates.

7.7.1    Any Affiliate of the General Partner may be employed or retained by the Partnership and may otherwise deal with the Partnership (whether as a buyer, lessor, lessee, advisor, manager, property manager, asset manager, furnisher of goods or services, broker, agent, lender or otherwise) and may receive from the Partnership any compensation, price or other payment therefor which the General Partner determines to be fair and reasonable.

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7.7.2    The Partnership may lend or contribute to its Subsidiaries or other Persons in which it has an equity investment, and such Persons may borrow funds from the Partnership, on terms and conditions established in the sole and absolute discretion of the General Partner; provided that any such arrangements (other than arrangements with wholly-owned subsidiaries) shall be on terms not less favorable to the Partnership than could have been obtained from a third party in an arm’s length transaction. The foregoing authority shall not create any right or benefit in favor of any Subsidiary or any other Person.

7.7.3    The Partnership may transfer assets to joint ventures, limited liability companies, other partnerships, corporations or other business entities in which it is or thereby becomes a participant upon such terms and subject to such conditions as the General Partner deems to be consistent with this Agreement, applicable law and the REIT status of the General Partner; provided that any such arrangements shall be on terms not less favorable to the Partnership than could have been obtained from a third party in an arm’s length transaction.

7.7.4    Except as expressly permitted by this Agreement, neither the General Partner nor any of its Affiliates shall sell, transfer or convey any property to, or purchase any property from, the Partnership, directly or indirectly, except pursuant to transactions that are, in the General Partner’s sole discretion, on terms that are fair and reasonable to the Partnership.

7.8    General Partner Participation. The General Partner agrees that all business activities of the General Partner, including activities pertaining to the acquisition, development or ownership of any Property shall be conducted through the Partnership, a Subsidiary, a GP Subsidiary or a taxable REIT subsidiary (within the meaning of Section 856 (l) of the Code); provided, however, that the General Partner is allowed to make a direct acquisition, but if and only if, such acquisition is made in connection with the issuance of Additional Securities, which direct acquisition and issuance have been approved and determined to be in the best interests of the General Partner and the Partnership by a majority of the Independent Directors.

7.9    Title to Partnership Assets. Title to Partnership assets, whether real, personal or mixed and whether tangible or intangible, shall be deemed to be owned by the Partnership as an entity, and no Partner, individually or collectively, shall have any ownership interest in such Partnership assets or any portion thereof. Title to any or all of the Partnership assets may be held in the name of the Partnership, the General Partner or one or more nominees as the General Partner may determine in its sole discretion, including Affiliates of the General Partner. The General Partner hereby declares and warrants that any Partnership assets for which legal title is held in the name of the General Partner or any nominee or Affiliate of the General Partner shall be held by the General Partner for the use and benefit of the Partnership in accordance with the provisions of this Agreement; provided, however, that the General Partner shall use its best efforts to cause beneficial and record title to such assets to be vested in the Partnership as soon as reasonably practicable. All Partnership assets shall be recorded as the property of the Partnership in its books and records, irrespective of the name in which legal title to such Partnership assets is held.

7.10    Redemptions. In the event the General Partner (i) redeems any REIT Shares or shares of preferred stock in the General Partner (“Preferred Stock”) or (ii) makes a cash tender offer or other offer to acquire REIT Shares, or shares of preferred stock, as applicable, then the General Partner shall cause the Partnership to purchase from the General Partner a number of General Partner Units or Preferred Units, as applicable, as determined based on the application of the Conversion Factor on the same terms that the General Partner redeemed such REIT Shares or shares of preferred stock, as applicable. Moreover, if the General Partner makes a cash tender offer or other offer to acquire REIT Shares, or Preferred Shares, as applicable, then the General Partner shall cause the Partnership to make a

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corresponding offer to the General Partner to acquire at least an equal number of General Partner Units or Preferred Units, as applicable, held by the General Partner. In the event any REIT Shares or Preferred Shares are exchanged by the General Partner pursuant to such offer, the Partnership shall redeem an equivalent number of the General Partner’s General Partner Units for an equivalent purchase price based on the application of the Conversion Factor or Preferred Units, as applicable.

7.11    Reliance by Third Parties. Notwithstanding anything to the contrary in this Agreement, any Person dealing with the Partnership shall be entitled to assume that the General Partner has full power and authority, without consent or approval of any other Partner or Person, to encumber, sell or otherwise use in any manner any and all assets of the Partnership and to enter into any contracts on behalf of the Partnership, and take any and all actions on behalf of the Partnership and such Person shall be entitled to deal with the General Partner as if the General Partner were the Partnership’s sole party in interest, both legally and beneficially. Each Limited Partner hereby waives any and all defenses or other remedies which may be available against such Person to contest, negate or disaffirm any action of the General Partner in connection with any such dealing. In no event shall any Person dealing with the General Partner or its representatives be obligated to ascertain that the terms of this Agreement have been complied with or to inquire into the necessity or expedience of any act or action of the General Partner or its representatives. Each and every certificate, document or other instrument executed on behalf of the Partnership by the General Partner or its representatives shall be conclusive evidence in favor of any and every Person relying thereon or claiming thereunder that (i) at the time of the execution and delivery of such certificate, document or instrument, this Agreement was in full force and effect, (ii) the Person executing and delivering such certificate, document or instrument was duly authorized and empowered to do so for and on behalf of the Partnership and (iii) such certificate, document or instrument was duly executed and delivered in accordance with the terms and provisions of this Agreement and is binding upon the Partnership.

7.12    Officers.

7.12.1    The General Partner, in its sole discretion, may appoint officers of the Partnership at any time. The officers of the Partnership, if appointed by the General Partner, may include a president, chief executive officer, chief legal officer, chief investment officer, any number of vice presidents, a secretary, chief financial officer or any other officer designated by the General Partner. The officers shall serve at the pleasure of the General Partner. Any individual may hold any number of offices. The officers shall exercise such powers and perform such duties as determined and authorized by the General Partner.

7.12.2    Subject to the rights, if any, of an officer under a contract of employment, any officer may be removed, either with or without cause, by the General Partner at any time. Any officer may resign at any time by giving written notice to the General Partner. Any resignation shall take effect on the date of the receipt of that notice or at any later time specified in that notice; and, unless otherwise specified in that notice, the acceptance of the resignation shall not be necessary to make it effective. Any resignation is without prejudice to the rights, if any, of the Partnership under any contract to which the officer is a party. A vacancy in any office because of death, resignation, removal, disqualification or any other cause shall be filled in the manner prescribed in this Agreement for regular appointments to that office.

7.12.3    No officer shall receive a salary for acting as an officer of the Company.

7.12.4    No officer of the Partnership shall have the authority to sign contracts and obligations on behalf of the Partnership. All contracts and obligations of the Partnership shall be executed by the General Partner, as General Partner of the Partnership.

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8.    Changes in General Partner.

8.1    Transfer of the General Partner’s Partnership Interest.

8.1.1    The General Partner shall not transfer all or any portion of its General Partner Interest or withdraw as the General Partner except as provided in, or in connection with a transaction contemplated by, Sections 8.1.2, 8.1.3 or 8.1.4.

8.1.2    Except as otherwise provided in Sections 8.1.3 or 8.1.4, the General Partner shall not engage in any merger, consolidation or other combination with or into another entity or the sale of all or substantially all of its assets (other than in connection with a change in the General Partner’s state of incorporation or organizational form), which in each case results in a change of control of the General Partner (a “Transaction”), unless:

(a)    Such Transaction is approved by a Majority Vote;

(b)    as a result of such Transaction, all Common Limited Partners will receive for each Common Unit an amount of cash, securities, or other property equal to the product of the Conversion Factor and the greatest amount of cash, securities or other property paid in the Transaction to a holder of one REIT Share; provided, however, that if, in connection with the Transaction, a purchase, tender or exchange offer (“Offer”) shall have been made to and accepted by the holders of more than 50% of the outstanding REIT Shares, each Common Limited Partner shall be given the option to exchange its Common Units for the greatest amount of cash, securities, or other property which a Common Limited Partner holding Common Units would have received had it (i) exercised its Exchange Right and (ii) sold, tendered or exchanged pursuant to the Offer the REIT Shares received upon exercise of the Exchange Right immediately prior to the expiration of the Offer; or

(c)    the General Partner is the surviving entity in the Transaction and either (i) the holders of REIT Shares do not receive cash, securities, or other property in the Transaction or (ii) all Common Limited Partners (other than the General Partner or any Subsidiary) receive in exchange for their Common Units, an amount of cash, securities, or other property (expressed as an amount per REIT Share) that is no less than the product of the Conversion Factor and the greatest amount of cash, securities, or other property (expressed as an amount per REIT Share) received in the Transaction by any holder of REIT Shares.

8.1.3    Notwithstanding Section 8.1.2, the General Partner may merge with or into or consolidate with another entity if immediately after such merger or consolidation (i) substantially all of the assets of the successor or surviving entity (the “Surviving General Partner”), other than Partnership Units and Preferred Units held by the General Partner, are contributed, directly or indirectly, to the Partnership as a Capital Contribution in exchange for Partnership Units or Preferred Units, as applicable, with a fair market value equal to the value of the assets so contributed as determined by the Surviving General Partner in good faith and (ii) the Surviving General Partner expressly agrees to assume all obligations of the General Partner, as appropriate, hereunder. Upon such contribution and assumption, the Surviving General Partner shall have the right and duty to amend this Agreement as set forth in this Section 8.1.3. The Surviving General Partner shall in good faith arrive at a new method for the calculation of the Cash Amount, the REIT Shares Amount and the Conversion Factor for a Common Unit after any such merger or consolidation so as to approximate the existing method for such calculation as closely as reasonably possible. Such calculation shall take into account, among other things, the kind and amount of securities, cash and other property that was receivable upon such merger or consolidation by a holder of REIT Shares or options, warrants, convertible or exchangeable securities or other rights relating thereto, and which a holder of Common Units could have acquired had such Common Units been exchanged immediately prior to such merger or consolidation. Such amendment to this Agreement shall

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provide for adjustment to such method of calculation, which shall be as nearly equivalent as may be practicable to the adjustments provided for herein with respect to the Conversion Factor. The Surviving General Partner also shall in good faith modify the definition of REIT Shares and make such amendments to Sections 9.4 and 9.5 so as to approximate the existing rights and obligations set forth in Sections 9.4 and 9.5 as closely as reasonably possible. The above provisions of this Section 8.1.3 shall similarly apply to successive mergers or consolidations permitted hereunder.

8.1.4    Notwithstanding Section 8.1.2:

(a)    the General Partner may transfer all or any portion of its General Partner Interest to (i) a wholly-owned Subsidiary of such General Partner or (ii) the owner of all of the ownership interests of such General Partner, and following a transfer of all of its General Partner Interest, may withdraw as General Partner; and

(b)    the General Partner may engage in any transaction that is not required by law or by the rules of any national securities exchange on which the REIT Shares are listed to be submitted to the vote of the holders of the REIT Shares.

8.2    Admission of a Substitute or Additional General Partner. A Person shall be admitted as a substitute or additional General Partner of the Partnership only if the following terms and conditions are satisfied:

8.2.1    the Person to be admitted as a substitute or additional General Partner shall have accepted and agreed to be bound by all the terms and provisions of this Agreement by executing a counterpart thereof and such other documents or instruments as may be required or appropriate in order to effect the admission of such Person as a General Partner, and a certificate evidencing the admission of such Person as a General Partner shall have been filed for recordation and all other actions required by Section 2.5 in connection with such admission shall have been performed;

8.2.2    if the Person to be admitted as a substitute or additional General Partner is a corporation or a partnership, it shall have provided the Partnership with evidence satisfactory to counsel for the Partnership of such Person’s authority to become a General Partner and to be bound by the terms and provisions of this Agreement; and

8.2.3    counsel for the Partnership shall have rendered an opinion (relying on or obtaining such opinions from other counsel as may be necessary) that (i) the admission of the Person to be admitted as a substitute or additional General Partner is in conformity with the Act and (ii) none of the actions taken in connection with the admission of such Person as a substitute or additional General Partner will cause (a) the Partnership to be classified other than as a partnership for federal income tax purposes or (b) the loss of any Limited Partner’s limited liability.

8.3    Effect of Bankruptcy, Withdrawal, Death or Dissolution of a General Partner.

8.3.1    Upon the occurrence of an Event of Bankruptcy as to a General Partner (and its removal pursuant to Section 8.4.1) or the death, withdrawal, removal or dissolution of a General Partner (except that, if a General Partner is on the date of such occurrence a partnership, the withdrawal, death, dissolution, Event of Bankruptcy as to, or removal of a partner in, such partnership shall be deemed not to be a dissolution of such General Partner if the business of such General Partner is continued by the remaining partner or partners), the Partnership shall be dissolved and terminated unless the Partnership is continued pursuant to Section 8.3.2. The merger of the General Partner with or into any entity that is admitted as a substitute or successor General Partner pursuant to Section 8.2 shall not be deemed to be the withdrawal, dissolution or removal of the General Partner.

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8.3.2    Following the occurrence of an Event of Bankruptcy as to a General Partner (and its removal pursuant to Section 8.4.1) or the death, withdrawal, removal or dissolution of a General Partner (except that, if a General Partner is on the date of such occurrence a partnership, the withdrawal, death, dissolution, Event of Bankruptcy as to, or removal of a partner in, such partnership shall be deemed not to be a dissolution of such General Partner if the business of such General Partner is continued by the remaining partner or partners), the Common Limited Partners, within 90 days after such occurrence, may elect to continue the business of the Partnership by selecting, subject to Section 8.2 and any other provisions of this Agreement, a substitute General Partner by a Majority Vote. If the Common Limited Partners elect to continue the business of the Partnership and admit a substitute General Partner, the relationship with the Partners and of any Person who has acquired an interest of a Partner in the Partnership shall be governed by this Agreement.

8.4    Removal of a General Partner.

8.4.1    Upon the occurrence of an Event of Bankruptcy as to, or the dissolution of, a General Partner, such General Partner shall be deemed to be removed automatically; provided, however, that if a General Partner is on the date of such occurrence a partnership, the withdrawal, death, dissolution, Event of Bankruptcy as to, or removal of, a partner in, such partnership shall be deemed not to be an Event of Bankruptcy or a dissolution of the General Partner if the business of such General Partner is continued by the remaining partner or partners. The Limited Partners may not remove the General Partner, with or without cause.

8.4.2    If a General Partner has been removed pursuant to this Section 8.4 and the Partnership is continued pursuant to Section 8.3, such General Partner shall promptly transfer and assign its General Partner Interest to the substitute General Partner approved by a Majority Vote in accordance with Section 8.3.2 and otherwise be admitted to the Partnership in accordance with Section 8.2. At the time of assignment, the removed General Partner shall be entitled to receive from the substitute General Partner the fair market value of the General Partner Interest of such removed General Partner as reduced by any damages caused to the Partnership by such General Partner as a result of the event that caused the removal. Such fair market value shall be determined by an appraiser mutually agreed upon by the General Partner, on the one hand, and the Limited Partners pursuant to a Majority Vote, on the other hand, within 10 days following the removal of the General Partner. In the event that the parties are unable to agree upon an appraiser, the removed General Partner and the Limited Partners pursuant to a Majority Vote, shall select an appraiser. Each such appraiser shall complete an appraisal of the fair market value of the removed General Partner’s General Partner Interest within 30 days of the General Partner’s removal, and the fair market value of the removed General Partner’s General Partner Interest shall be the average of the two appraisals; provided, however, that if the higher appraisal exceeds the lower appraisal by more than 20% of the amount of the lower appraisal, the two appraisers, no later than 40 days after the removal of the General Partner, shall select a third appraiser who shall complete an appraisal of the fair market value of the removed General Partner’s General Partner Interest no later than 60 days after the removal of the General Partner. In such case, the fair market value of the removed General Partner’s General Partner Interest shall be the average of the two appraisals closest in value.

8.4.3    The General Partner Interest of a removed General Partner, until transferred pursuant to Section 8.4.2, shall be converted to that of a special Limited Partner; provided, however, such removed General Partner shall not have any rights to participate in the management and affairs of the Partnership, and shall not be entitled to any portion of the income, expense, Net Income, gain or Net Loss allocations or cash distributions allocable or payable, as the case may be, to the Limited Partners. Instead, such removed General Partner shall receive and be entitled only to retain distributions or allocations of such items that it would have been entitled to receive in its capacity as General Partner, until the transfer is effective pursuant to Section 8.4.2.

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8.4.4    All Partners shall have given and hereby do give such consents, shall take such actions and shall execute such documents as shall be legally necessary, desirable and sufficient to effect all the foregoing provisions of this Section.

9.    Rights and Obligations of the Limited Partners.

9.1    Management of the Partnership. The Limited Partners shall not participate in the management or control of Partnership business nor shall they transact any business for or on behalf of the Partnership, nor shall they have the power to sign for or bind the Partnership, such powers being vested solely and exclusively in the General Partner.

9.2    Power of Attorney. Each Limited Partner, pursuant to Section 14, hereby irrevocably appoints the General Partner its true and lawful attorney-in-fact.

9.3    Limitation on Liability of Limited Partners. No Limited Partner shall be liable for any debts, liabilities, contracts or obligations of the Partnership. A Limited Partner shall be liable to the Partnership only to make payments of its Capital Contributions, if any, as and when due hereunder. After its Capital Contributions are fully paid, no Limited Partner shall, except as otherwise required by the Act, be required to make any further Capital Contributions or other payments or lend any funds to the Partnership.

9.4    Exchange Right.

9.4.1    Subject to the provisions in this Section 9.4 and the provisions of any agreements between the Partnership and one or more Common Limited Partners with respect to Common Units held by them, each Common Limited Partner shall have the right (the “Exchange Right”), beginning on the Exchange Date, to require the Partnership to exchange on a Specified Exchange Date all or a portion of the Common Units held by such Common Limited Partner for the applicable Cash Amount to be paid by the Partnership (with the Cash Amount determined 60 days after the receipt of the Exchange Notice for purposes of this Section 9.4), provided that such Common Units (or the LTIP Units from which they were converted) shall have been outstanding for at least one year. The Exchange Right shall be exercised pursuant to the delivery of an Exchange Notice to the Partnership (with a copy to the General Partner) by the Common Limited Partner who is exercising the Exchange Right (the “Exchanging Partner”); provided, however, that the Partnership shall not be obligated to satisfy such Exchange Right if the General Partner elects to purchase the Common Units subject to the Exchange Notice pursuant to Section 9.4.2; and provided, further, that no Common Limited Partner may deliver more than two Exchange Notices during each calendar year. A Common Limited Partner may not exercise the Exchange Right for less than 1,000 Common Units or, if such Common Limited Partner holds less than 1,000 Common Units, all of the Common Units held by such Partner. The Exchanging Partner shall have no right, with respect to any Common Units so exchanged, to receive any distribution paid with respect to Common Units if the record date for such distribution is on or after the Specified Exchange Date.

9.4.2    Notwithstanding the provisions of Section 9.4.1, a Common Limited Partner that exercises the Exchange Right shall be deemed to have also offered to sell the Common Units described in the Exchange Notice to the General Partner, and the General Partner may, in its sole and absolute discretion, elect to purchase directly and acquire such Common Units by paying to the Exchanging Partner either the Cash Amount or the REIT Shares Amount, as elected by the General Partner (in its sole and absolute discretion), on the Specified Exchange Date, whereupon the General Partner shall acquire the Common Units offered for exchange by the Exchanging Partner and shall be treated for all purposes of this Agreement as the owner of such Common Units. If the General Partner shall elect to exercise its right to purchase Common Units under this Section 9.4.2 with respect to the Exchange Notice, it shall so notify the Exchanging Partner within five business days after the receipt by the General Partner of such

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Exchange Notice. Unless the General Partner (in its sole and absolute discretion) shall exercise its right to purchase Common Units from the Exchanging Partner pursuant to this Section 9.4.2, the General Partner shall have no obligation to the Exchanging Partner or the Partnership with respect to the Exchanging Partner’s exercise of the Exchange Right. In the event the General Partner shall exercise its right to purchase Common Units with respect to the exercise of an Exchange Right in the manner described in the first sentence of this Section 9.4.2, the Partnership shall have no obligation to pay any amount to the Exchanging Partner with respect to such Exchanging Partner’s exercise of such Exchange Right, and each of the Exchanging Partner and the General Partner shall treat the transaction between the General Partner and the Exchanging Partner for federal income tax purposes as a sale of the Exchanging Partner’s Common Units to the General Partner.

9.4.3    Each Exchanging Partner agrees to execute such documents as the General Partner may reasonably require in connection with the issuance of REIT Shares upon exercise of the Exchange Right, including an assignment of the Common Units, and if the General Partner is relying upon the exemption from registration under the Securities Act provided by Regulation D promulgated under the Securities Act, or any successor rule, a document pursuant to which the Exchanging Partner makes a representation that it is an accredited investor; provided, however, that if the Exchanging Partner cannot make such representation, then the Exchanging Partner shall have no right to exercise its Exchange Right.

9.4.4    In case of any reclassification of the REIT Shares (including, but not limited to, any reclassification upon a consolidation or merger in which the General Partner is the continuing corporation) into securities other than REIT Shares, for purposes of Section 9.4.2, the General Partner may thereafter exercise its right to purchase Common Units for the kind and amount of shares of such securities receivable upon such reclassification by a holder of the number of REIT Shares for which such Common Units could be purchased immediately prior to such reclassification.

9.4.5    Any REIT Shares issued to an Exchanging Partner upon the exercise by the General Partner of its right to purchase Common Units under Section 9.4.2, shall not be required to be registered under the Securities Act, unless subject to a separate agreement between the General Partner and the Exchanging Partner.

9.4.6    Notwithstanding the provisions of Section 9.4.1 and 9.4.2, a Common Limited Partner shall not be entitled to exercise the Exchange Right if such exercise would result in (i) any Person owning, directly or indirectly, shares of the General Partner in excess of the Shareholder Limitation (or, if applicable, the Excepted Holder Limit), (ii) the REIT Shares being owned by less than 100 persons (determined without reference to any rules of attribution), (iii) the General Partner being “closely held” within the meaning of Section 856(h) of the Code, (iv) the General Partner owning, directly or constructively, 9.9% or more of the ownership interests in a tenant within the meaning of Section 856(d)(2)(B) of the Code, (v) the acquisition of the REIT Shares by such Common Limited Partner could cause a violation of the Securities Act either for the exchange or other securities offerings, (vi) the REIT Shares would be required to be registered under the Securities Act, (vii) the General Partner no longer qualifies as a REIT under the Code or (viii) the General Partner believes that the Partnership will be treated as a “publicly traded partnership.” The General Partner, in its sole and absolute discretion, may waive any of the restrictions on exchange set forth in this Section 9.4.6.

9.4.7    Each Common Limited Partner represents, warrants and certifies that it has, and will have, marketable and unencumbered title to its Common Units, free and clear of any liens or the rights or interest of any other person or entity and covenants and agrees to deliver its Common Units free of any such items. Each Common Limited Partner further represents, warrants and certifies that it has, and will have, the full right, power and authority to transfer and surrender its Common Units and that it

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has obtained, and will obtain, the consent or approval of all persons or entities, if any, having the right to consent to or approve of such transfer and surrender. The General Partner shall have no obligation to acquire Common Units (i) to the extent that any such Common Units are subject to any liens, encumbrances or the right or interest of any other person or entity or (ii) in the event that the Common Limited Partner shall fail to give the General Partner adequate assurances that such Common Units are not subject to any such liens, encumbrances or the right or interest of any other person or entity or shall fail to fully indemnify the General Partner as set forth below; provided, however, the General Partner may, in its sole discretion, acquire Common Units subject to a lien, encumbrance or right of another person or entity and in such case the General Partner shall reduce the Cash Amount (or REIT Shares Amount) paid to the Common Limited Partner by the amount of the lien, encumbrance or right of any other person or entity. The Common Limited Partner agrees to indemnify and hold the General Partner harmless from and against any and all liabilities, charges, costs and expenses relating to such Common Limited Partner’s Common Units which are subject to the Exchange Right including, without limitation, with respect to any liens, encumbrances or rights or interests of other persons or entities. Each Common Limited Partner further agrees that, in the event any state or local transfer tax is payable as a result of the transfer of its Common Units to the General Partner pursuant to the Exchange Right, such Common Limited Partner shall assume and pay such transfer tax.

9.4.8    Any Cash Amount to be paid to an Exchanging Partner pursuant to this Section 9.4 shall be paid on the Specified Exchange Date; provided, however, that the General Partner may elect to cause the Specified Exchange Date to be delayed for up to 180 days to the extent required for the General Partner to obtain additional funding to be used to make such payment of the Cash Amount by the issuance of additional REIT Shares or otherwise. Notwithstanding the foregoing, the General Partner agrees to use its commercially reasonable efforts to cause the closing of the exchange to occur as quickly as reasonably possible.

9.4.9    Notwithstanding any other provision of this Agreement, the General Partner shall place appropriate restrictions on the ability of the Common Limited Partners to exercise their Exchange Rights as and if deemed necessary to ensure that the Partnership does not constitute a “publicly traded partnership” under Section 7704 of the Code. If and when the General Partner determines that imposing such restrictions is necessary, the General Partner shall give prompt written notice thereof to each Common Limited Partner and each other Person that holds interests in the Partnership convertible for, or other instruments exercisable for, Common Units.

9.4.10    A fee may be charged in connection with an exercise of Exchange Rights pursuant to this Section 9.4 to cover the expenses of the Partnership or the General Partner.

9.4.11    The exercise of an Exchange Right by a Common Limited Partner will be subject to compliance with securities laws applicable to the exchange and therefore the Exchange Right may not be exercisable in the absence of an effective registration statement or an available exemption from registration.

9.4.12    Holders of LTIP Units shall not be entitled to the Exchange Rights provided for in Section 9.4 of this Agreement, unless and until such LTIP Units have been converted into Common Units. Notwithstanding the foregoing, and except as otherwise permitted by the Vesting Agreement or any award document, plan or other agreement pursuant to which an LTIP Unit was issued, without the consent of the General Partner, the Exchange Rights shall not be exercisable with respect to any Common Unit issued upon conversion of an LTIP Unit until two years after the date on which the LTIP Unit was issued, provided however, that the foregoing restriction shall not apply (i) if the Exchange Right is exercised by an LTIP Unit holder in connection with a transaction that falls within the definition of a “Change in Control” under the agreement or agreements pursuant to which the LTIP Units were issued to such holder or (ii) in connection with a mandatory conversion in connection with a Capital Transaction as described in Section 12.1 of Exhibit D.

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9.5    Call Right.

9.5.1    In the event of a General Partner Liquidity Event or immediately prior to a General Partner Liquidity Event, the General Partner shall have the right (the “Call Right”) to purchase (i) all of the Common Units held by a Common Limited Partner and (ii) all of the LTIP Units held by an LTIP Unit Limited Partner (each of clause (i) and clause (ii), a “Called Unit”), at a price equal to the Cash Amount; provided, however, that the General Partner may, in its sole and absolute discretion, beginning on or after the Exchange Date, elect to purchase such Called Units by paying to the Limited Partner in question the REIT Shares Amount in lieu of the Cash Amount, provided further that for purposes of this Section 9.5, (i) the determination of the Economic Capital Account Balances and the Cash Amount of any LTIP Units that are Called Units shall also take into account any allocations that occur in connection with the General Partner Liquidity Event or that would occur in connection with the General Partner Liquidity Event if the assets of the Partnership were sold at a value determined by the General Partner in good faith using the value attributed to the General Partner’s General Partner Units in the context of the General Partner Liquidity Event and (ii) the REIT Shares Amount paid for Called Units that are LTIP Units shall not exceed a number of REIT Shares with a value equal to the Cash Amount of such LTIP Units. The Call Right shall be exercised pursuant to a notice (the “Call Notice”) delivered by the General Partner to the Limited Partner. The General Partner may not exercise the Call Right for less than all of the Called Units. A Limited Partner receiving the Call Notice described above shall have no rights with respect to any interest in the Partnership other than the right to receive payment for its interest in the Partnership in cash or REIT Shares in accordance with this Section 9.5. An assignee of a Limited Partner shall be bound by and subject to the Call Right of the General Partner pursuant to this Section 9.5. In connection with any exercise of such Call Right by the General Partner with respect to an assignee, the Cash Amount (or REIT Shares Amount) shall be paid by the General Partner directly to such assignee and not to the Limited Partner from which such assignee acquired its Called Units, as applicable. The Call Right may be assigned to any acquiring company pursuant to a General Partner Liquidity Event.

9.5.2    Within 30 days after the delivery of the Call Notice by the General Partner to the Limited Partners under this Section 9.5, the General Partner (subject to the limitations set forth in Section 9.5.4) shall transfer and deliver the Cash Amount (or the REIT Shares Amount) to the Limited Partners or, as applicable, their assignees, whereupon the General Partner (or its designee) shall acquire the Called Units of such Limited Partners or, as applicable, their assignees, and shall be treated for all purposes of this Agreement as the owner of such Called Units.

9.5.3    In the event that the General Partner elects to pay a Limited Partner in the form of the REIT Shares Amount and such REIT Shares Amount is not a whole number of REIT Shares, the Limited Partner shall be paid (i) the number of REIT Shares which equals the nearest whole number less than such amount plus (ii) an amount of cash which the General Partner determines, in its reasonable discretion, to represent the fair value of the remaining fractional REIT Share which would otherwise be payable to the Limited Partner.

9.5.4    In determining whether to elect to pay the REIT Shares Amount in lieu of the Cash Amount in Sections 9.5.1 and 9.5.2, the General Partner shall consider whether such election would result in, (i) any Person owning shares of the General Partner in excess of the Shareholder Limitation (or, if applicable, the Excepted Holder Limit), (ii) the REIT Shares being owned by less than 100 persons, (iii) the General Partner being “closely held” within the meaning of Section 856(h) of the Code or (iv) the General Partner owning, directly or constructively, 9.9% or more of the ownership interests in a tenant within the meaning of Section 856(d)(2)(B) of the Code. The General Partner, in its sole and absolute discretion, may elect to pay the REIT Shares Amount despite the fact that it would result in any of the occurrences set forth in this Section 9.5.4.

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9.5.5    Each Limited Partner agrees to execute such documents as the General Partner may reasonably require in connection with the issuance of the REIT Shares upon exercise of the Call Right including, without limitation, an assignment of the Called Units. Each Limited Partner represents, warrants and certifies that it has, and will have, marketable and unencumbered title to its Called Units, free and clear of any liens or the rights or interest of any other person or entity and covenants and agrees to deliver its Called Units, free of any such items. The Limited Partner further represents, warrants and certifies that it has, and will have, the full right, power and authority to transfer and surrender its Called Units, as applicable, and that it has obtained, and will obtain, the consent or approval of all persons or entities, if any, having the right to consent to or approve of such transfer and surrender. The General Partner shall have no obligation to acquire Called Units (i) to the extent that any such Called Units are subject to any liens, encumbrances or the right or interest of any other person or entity or (ii) in the event that the Limited Partner shall fail to give the General Partner adequate assurances that such Called Units are not subject to any such liens, encumbrances or the right or interest of any other person or entity or shall fail to fully indemnify the General Partner as set forth below; provided, however, the General Partner may, in its sole discretion, acquire Called Units subject to a lien, encumbrance or right of another person or entity and in such case the General Partner shall reduce the Cash Amount (or REIT Shares Amount) paid to the Limited Partner by the amount of the lien, encumbrance or right of any other person or entity. The Limited Partner agrees to indemnify and hold the General Partner harmless from and against any and all liabilities, charges, costs and expenses relating to such Limited Partner’s Called Units, which are subject to the Call Right or the exercise of the Call Right including, without limitation, with respect to any liens, encumbrances or rights or interests of other persons or entities. Each Limited Partner further agrees that, in the event any state or local transfer tax is payable as a result of the transfer of its Called Units to the General Partner pursuant to the exercise of the Call Right, such Limited Partner shall assume and pay such transfer tax.

9.5.6    In the event this Call Right is exercised, all Unvested LTIP Units shall terminate and be null and void.

9.6    Put Option.

9.6.1    In the event of a General Partner Liquidity Event or an Advisory Agreement Termination Event, or immediately prior to a General Partner Liquidity Event, the Limited Partners shall have the right (the “Put Right”) to sell all or a portion of their Limited Partner Units (a “Put Unit”) to the Partnership at a price equal to the fair market value as set forth in Section 9.6.3. If the event triggering the Put Right is a General Partner Liquidity Event, the Put Units will be paid in cash, and the Limited Partners may, in their sole discretion, elect to take the consideration offered in the General Partner Liquidity Event if it is equity in an entity. If the event triggering the Put Right is an Advisory Agreement Termination Event, the Put Units will be paid in the form of an interest bearing promissory note (the “Promissory Note”) subject to the terms set forth in Section 9.6.4. The Put Right shall be exercised pursuant to a notice (the “Put Notice”) delivered by the Limited Partner to the General Partner. An assignee of a Limited Partner shall receive the Put Right set forth in this Section 9.6. In connection with any exercise of such Put Right by an assignee of a Limited Partner, the Fair Market Value of the Put Units shall be paid by the Partnership directly to such assignee and not to the Limited Partner from which such assignee acquired its Put Units.

9.6.2    Within 30 days after the delivery of the Put Notice by the Limited Partner to the General Partner under this Section 9.6, the Partnership shall transfer and deliver the fair market value of the Put Units to such Limited Partner or, as applicable, its assignee, whereupon the Partnership shall acquire the Put Units of such Limited Partner or, as applicable, its assignee, and such Put Units shall no longer be considered outstanding.

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9.6.3    The value of the Put Units being sold pursuant to this Section 9.6 shall be equal to the amount the Limited Partner would have received if all of the assets of the Partnership were sold at the Transaction Value, (or at their fair market value if there was no General Partner Liquidity Event or Advisory Agreement Termination Event) all liabilities of the Partnership were paid in full and all remaining funds were distributed to the Partners in accordance with this Agreement. The fair market value of a Put Units shall be determined by agreement between the Partnership and the Limited Partner. If the Partnership and the Limited Partner cannot agree upon the fair market value of the Put Units being sold pursuant to this Section 9.6 within 30 days, the fair market value thereof shall be determined by an independent appraiser selected by the Limited Partner and approved by the Partnership. The decision of the appraiser selected pursuant to this Section 9.6 will be final and binding and may be enforced by legal proceedings. The Partnership and the Limited Partner shall equally compensate the appraiser appointed pursuant to this Section 9.6.

9.6.4    The Promissory Note shall bear interest at a market interest rate as determined by the Conflicts Committee of the General Partner and shall be repaid after the Stockholders have received Distributions in an aggregate amount equal to the sum of (i) the Stockholders’ 6% Return and (ii) Stockholders’ Invested Capital. Provided that if a General Partner Liquidity Event occurs and the Promissory Note has not yet been paid in full, the Promissory Note shall be paid in full on the date of or immediately prior to the General Partner Liquidity Event. Notwithstanding anything herein to the contrary, in accordance with Section 736 of the Code, the Promissory Note shall be disregarded for applicable income tax purposes and the Limited Partner shall continue to be treated as a partner of the Partnership in respect of its Partnership Units for such purposes until the Partnership has satisfied all of its obligations under the Promissory Note. Without limiting the foregoing, the Limited Partner shall not be required to accrue interest on the Promissory Note in income and the Partnership shall not deduct such interest for such purposes; provided, that, any cash or property paid to the Limited Partner with respect to such interest shall be reported to the Limited Partner on Internal Revenue Service Schedule K-1 to Form 1065 (or such successor schedule or form).

9.6.5    In the event that insufficient funds are available, in the General Partner’s sole discretion, to repurchase all of such Limited Partner Units, the Limited Partner will be deemed to have priority for subsequent Partnership repurchases over Limited Partners who subsequently request repurchases.

9.6.6    Repurchases of Limited Partner Units shall be subject to the restrictions set forth in Section 10.1. Such requests will be considered by the General Partner in the order in which they are received. No repurchase may result in a Limited Partner owning a partial Unit.

9.6.7    In no event shall Limited Partner Units owned by the General Partner or its Affiliates be repurchased by the Partnership pursuant to this Section 9.6.

9.6.8    Notwithstanding the above or the restrictions in Section 10.1, the Partnership shall not purchase more than 10% in the aggregate of the total Limited Partner Units (other than those excluded by Regulation Section 1.7704-1(k)(1)(ii)) of the Partnership per annum reduced by the percentage of any transfers made under Regulation Sections 1.7704-1(g) or transfers that do not qualify for safe harbor treatment under the Regulations (which excludes private transfers described in Regulation Section 1.7704-1(e)).

9.6.9    Notwithstanding anything in this Section 9.6 to the contrary, in no event shall the Partnership repurchase any LTIP Unit.

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9.6.10    The Acquisition Date for purposes of this Section 9.6 shall be deemed to be the date the LTIP Unit was issued with respect to the repurchase of any Common Unit into which an LTIP Unit automatically converted pursuant to its terms.

10.    Transfers of Limited Partner Interests.

10.1    Restrictions on Transfer of Limited Partner Interests.

10.1.1    Subject to the provisions of this Section 10.1, no Limited Partner may offer, sell, assign, hypothecate, pledge or otherwise transfer all or any portion of its Limited Partner Interest, or any of such Limited Partner’s economic rights as a Limited Partner, whether voluntarily or by operation of law or at judicial sale or otherwise (collectively, a “Transfer”) without the consent of the General Partner, which consent may be granted or withheld in its sole and absolute discretion. Any such purported Transfer undertaken without such consent shall be considered to be null and void ab initio and shall not be given effect. The General Partner may require, as a condition of any Transfer to which it consents, that the transferor assume all costs incurred by the Partnership in connection therewith.

10.1.2    No Limited Partner may withdraw from the Partnership other than as a result of a permitted Transfer (i.e., a Transfer consented to as contemplated by Section 10.1.1 or Section 10.1.3 or a Transfer made pursuant to Section 10.4) of all of its Limited Partner Units pursuant to this Section 10 or pursuant to an exchange of all of its Common Units pursuant to Section 9.4. Upon the permitted Transfer or redemption of all of a Limited Partner’s Limited Partner Interest, such Limited Partner shall cease to be a Limited Partner.

10.1.3    Notwithstanding Section 10.1.1 and subject to Sections 10.1.4, 10.1.5 and 10.1.6, a Limited Partner may Transfer, with the consent of the General Partner, all or a portion of its Limited Partner Units to (i) a parent or parent’s spouse, natural or adopted descendants, spouse of such descendant, or brother or sister, or a trust created by such Limited Partner for the benefit of such Limited Partner and/or any such Person, of which trust such Limited Partner or any such Person is a trustee, (ii) a corporation, a partnership or limited liability company controlled by a Person or Persons named in (i) above or (iii) if the Limited Partner is an entity, its beneficial owners.

10.1.4    No Limited Partner may effect a Transfer of its Limited Partner Interests, in whole or in part, if, in the opinion of legal counsel for the Partnership, such proposed Transfer would require the registration of the Limited Partner Interests under the Securities Act or would otherwise violate any applicable federal or state securities or blue sky law.

10.1.5    No Transfer by a Limited Partner of its Limited Partner Units, in whole or in part, may be made to any Person if, in the opinion of the General Partner based on the advice of legal counsel for the Partnership, if appropriate, the Transfer (i) would result in the Partnership’s being treated as an association taxable as a corporation (other than a qualified REIT subsidiary within the meaning of Section 856(i) of the Code), (ii) in the belief of the General Partner, would adversely affect the ability of the General Partner to continue to qualify as a REIT or subject the General Partner to any additional taxes under Section 857 or Section 4981 of the Code, (iii) in the belief of the General Partner, would cause the Limited Partner Units to be deemed to be “traded on an established securities market” or “readily tradable on a secondary market (or substantial equivalent thereof)” under the provisions applicable to publicly traded partnership status under Section 7704 of the Code and the Regulations promulgated thereunder, (iv) would cause the Partnership to become, with respect to any employee benefit plan subject to Title I of ERISA or to Section 4975 of the Code, a “party-in-interest” (as defined in Section 3(14) of ERISA) or a “disqualified person” (as defined in Section 4975(e)(2) of the Code), (v) would, in the belief of the General Partner, cause any portion of the assets of the Partnership to constitute assets of any employee benefit plan pursuant to Department of Labor Regulations Section 2510.3-101 or (vi) would subject the Partnership to be regulated under the Investment Company Act of 1940, as amended, the Investment Advisers Act of 1940, as amended, or the fiduciary responsibility provisions of ERISA.

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10.1.6    No Limited Partner may Transfer any Limited Partner Units to a lender to the Partnership or any Person who is related (within the meaning of Regulations Section 1.752-4(b)) to any lender to the Partnership whose loan constitutes a nonrecourse liability (within the meaning of Regulations Section 1.752-1(a)(2)), without the consent of the General Partner, which may be withheld in its sole and absolute discretion, provided that as a condition to such consent the lender will be required to enter into an arrangement with the Partnership and the General Partner to exchange or redeem for the Cash Amount any Limited Partner Units in which a security interest is held simultaneously with the time at which such lender would be deemed to be a Partner in the Partnership for purposes of allocating liabilities to such lender under Section 752 of the Code.

10.1.7    Any Transfer in contravention of any of the provisions of this Section 10 shall be void and ineffectual and shall not be binding upon or recognized by the Partnership.

10.1.8    Prior to the consummation of any Transfer under this Section 10, the transferor and/or the transferee shall deliver to the General Partner such opinions, certificates and other documents as the General Partner shall request in connection with such Transfer.

10.2    Admission of Substitute Limited Partner.

10.2.1    Subject to the other provisions of this Section 10, an assignee of a Limited Partner Interest (which shall be understood to include any purchaser, transferee, donee, or other recipient of any disposition of such Limited Partner Interest) shall be deemed admitted as a Limited Partner only with the consent of the General Partner, which consent may be granted or withheld in its sole and absolute discretion and upon the satisfactory completion of the following:

(a)    The assignee shall have accepted and agreed to be bound by the terms and provisions of this Agreement by executing a counterpart or an amendment thereof, including a revised Exhibit A, and such other documents or instruments as the General Partner may require in order to effect the admission of such Person as a Limited Partner.

(b)    The assignee shall have delivered a letter containing the representation set forth in Section 15.1.1 through 15.1.6 and the agreement set forth in Section 15.1.7.

(c)    If the assignee is a corporation, partnership or trust, the assignee shall have provided the General Partner with evidence satisfactory to counsel for the Partnership of the assignee’s authority to become a Limited Partner under the terms and provisions of this Agreement.

(d)    The assignee shall have executed the power of attorney as set forth in Section 14.

(e)    The assignee shall have paid all legal fees and other expenses of the Partnership and the General Partner and filing and publication costs in connection with its substitution as a Limited Partner.

(f)    The assignee has obtained the prior written consent of the General Partner to its admission as a Substitute Limited Partner, which consent may be given or denied in the exercise of the General Partner’s sole and absolute discretion.

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10.2.2    For the purpose of allocating Net Income and Net Loss and distributing cash received by the Partnership, a Substitute Limited Partner shall be treated as having become a Partner upon the later of the date specified in the Transfer documents or the date on which the General Partner has received all necessary instruments of Transfer and substitution subject to Section 5.1.5.

10.2.3    The General Partner shall cooperate with the Person seeking to become a Substitute Limited Partner by preparing the documentation required by this Section 10.2 and making all official filings and publications. The Partnership shall take all such action as promptly as practicable after the satisfaction of the conditions in this Section 10 to the admission of such Person as a Limited Partner of the Partnership.

10.3    Rights of Assignees of Partnership Interests.

10.3.1    Subject to the provisions of Sections 10.1 and 10.2, except as required by operation of law, the Partnership shall not be obligated for any purposes whatsoever to recognize the assignment by any Limited Partner of its Partnership Interest until the Partnership has received notice thereof.

10.3.2    Any Person who is the assignee of all or any portion of a Limited Partner’s Limited Partner Interest, but does not become a Substitute Limited Partner and desires to make a further assignment of such Limited Partner Interest, shall be subject to all the provisions of this Section 10 to the same extent and in the same manner as any Limited Partner desiring to make an assignment of its Limited Partner Interest.

10.4    Effect of Bankruptcy, Death, Incompetence or Termination of a Limited Partner. The occurrence of an Event of Bankruptcy as to a Limited Partner, the death of a Limited Partner or a final adjudication that a Limited Partner is incompetent (which term shall include, but not be limited to, insanity) shall not cause the termination or dissolution of the Partnership, and the business of the Partnership shall continue if an order for relief in a bankruptcy proceeding is entered against a Limited Partner, the trustee or receiver of the Limited Partner’s estate or, if Limited Partner dies, Limited Partner’s executor, administrator or trustee, or, if Limited Partner is finally adjudicated incompetent, Limited Partner’s committee, guardian or conservator, and any such Person shall have the rights of such Limited Partner for the purpose of settling or managing Limited Partner’s estate property and such power as the bankrupt, deceased or incompetent Limited Partner possessed to assign all or any part of his Partnership Interest and to join with the assignee in satisfying conditions precedent to the admission of the assignee as a Substitute Limited Partner.

10.5    Joint Ownership of Interests. A Partnership Interest may be acquired by two individuals as joint tenants with right of survivorship, provided that such individuals either are married or are related and share the same personal residence. The written consent or vote of both owners of any such jointly held Partnership Interest shall be required to constitute the action of the owners of such Partnership Interest; provided, however, that the written consent of only one joint owner will be required if the Partnership has been provided with evidence satisfactory to the counsel for the Partnership that the actions of a single joint owner can bind both owners under the applicable laws of the state of residence of such joint owners. Upon the death of one owner of a Partnership Interest held in a joint tenancy with a right of survivorship, the Partnership Interest shall become owned solely by the survivor as a Limited Partner and not as an assignee. The Partnership need not recognize the death of one of the owners of a jointly-held Partnership Interest until it shall have received notice of such death. Upon notice to the General Partner from either owner, the General Partner shall cause the Partnership Interest to be divided into two equal Partnership Interests, which shall thereafter be owned separately by each of the former owners.

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11.    Books and Records; Accounting; Tax Matters.

11.1    Books and Records. At all times during the continuance of the Partnership, the Partners shall keep or cause to be kept at the Partnership’s specified office true and complete books of account in accordance with generally accepted accounting principles, including: (i) a current list of the full name and last known address of each Partner, (ii) a copy of the Certificate, (iii) copies of the Partnership’s federal, state and local income tax returns and reports, (iv) copies of this Agreement and any financial statements of the Partnership for the three most recent years and (v) all documents and information required under the Act.

11.2    Custody of Partnership Funds; Bank Accounts.

11.2.1    All funds of the Partnership not otherwise invested shall be deposited in one or more accounts maintained in such banking or brokerage institutions as the General Partner shall determine, and withdrawals shall be made only on such signature or signatures as the General Partner may, from time to time, determine.

11.2.2    All deposits and other funds not needed in the operation of the business of the Partnership may be invested by the General Partner in investment grade instruments (or investment companies whose portfolio consists primarily thereof), government obligations, certificates of deposit, bankers’ acceptances, municipal notes and bonds or other investments approved by the Board of Directors. The funds of the Partnership shall not be commingled with the funds of any other Person except for such commingling as may necessarily result from an investment in those investment companies permitted by this Section 11.2.2.

11.3    Fiscal and Taxable Year. The fiscal and taxable year of the Partnership shall be the calendar year, except as otherwise required by applicable law.

11.4    Annual Tax Information and Report. The General Partner shall supply each person who was a Limited Partner at any time during such year the tax information necessary for such Partner to file such Limited Partner’s individual tax returns as shall be reasonably required by law.

11.5    Partnership Representative; Tax Elections.

11.5.1    The General Partner shall be the “partnership representative” for purposes of Section 6223 and 6231 of the Code and shall, at the Partnership’s expense, cause to be prepared and timely filed after the end of each taxable year of the Partnership all federal and state income tax returns required of the Partnership for such taxable year. If any state or local tax law provides for a partnership representative or Person having similar rights, powers, authority or obligations, the General Partner shall also serve in such capacity. The Partnership shall make such elections pursuant to the provisions of the Code as the General Partner, in its sole discretion, deems appropriate (including, in the General Partner’s sole discretion, an election under Section 754 of the Code or an election to have the Partnership treated as an “electing investment partnership” for purposes of Section 743 of the Code).

11.5.2    If any audit adjustment results in an underpayment of tax that is imputed to the Partnership and would be assessed and collected at the Partnership level in the period that the adjustment becomes final, the Partnership may, in the sole discretion of the General Partner, elect:

(a)    to pay an imputed underpayment as calculated under Section 6225(b) of the Code with respect to such adjustment, including interest, penalties and related tax (“Imputed Underpayment”) in the Adjustment Year or otherwise take the Internal Revenue Service adjustment into account in the Adjustment Year. The General Partner shall use commercially reasonable efforts to reduce

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the amount of such Imputed Underpayment on account of the tax-exempt status (as defined in Section 168(h)(2) of the Code) of any Limited Partner as provided in Section 6225(c)(3) of the Code. Each Limited Partner agrees to indemnify and hold harmless the Partnership and the General Partner from and against any liability with respect to the Limited Partner’s proportionate share of any Imputed Underpayment, regardless of whether such Limited Partner is a Limited Partner in the Adjustment Year, and to promptly pay its proportionate share of any Imputed Underpayment to the Partnership within 15 days following the General Partner’s request for payment and any amount that is not funded shall be treated in accordance with Section 6.2. Each Limited Partner’s proportionate share shall be determined by the General Partner in good faith taking into account each Limited Partner’s (or former Partner’s) particular status, including its tax-exempt or non-United States status, its interest in the Partnership in the “Reviewed Year,” and its timely provision of information necessary to reduce the amount of Imputed Underpayment set forth in Section 6225(c) of the Code; or

(b)    under Section 6226(a) of the Code, to cause the Partnership to issue adjusted Schedule K-1s or any other similar statement prescribed by the Code, Regulations or other administrative guidance published by the Internal Revenue Service or other taxing authority to each applicable Partner for the Reviewed Year, who will then be required to pay their allocable share of tax otherwise attributable to the Partnership. Each Partner hereby agrees and consents to such election and agrees to take any action, and furnish the General Partner with any information necessary to give effect to such election, as required by such Section 6226(a) of the Code and applicable Regulations or other administrative guidance published by the Internal Revenue Service or other taxing authority.

11.6    Reports to Limited Partners.

11.6.1    As soon as practicable after the close of each fiscal quarter (other than the last quarter of the fiscal year), upon written request by a Limited Partner to the General Partner, the General Partner shall make available to such Limited Partner a quarterly report containing financial statements of the Partnership, or of the General Partner if such statements are prepared solely on a consolidated basis with the General Partner, for such fiscal quarter, presented in accordance with generally accepted accounting principles. As soon as practicable after the close of each fiscal year, upon written request by a Limited Partner to the General Partner, the General Partner shall make available to such Limited Partner an annual report containing financial statements of the Partnership, or of the General Partner if such statements are prepared solely on a consolidated basis with the General Partner, for such fiscal year, presented in accordance with generally accepted accounting principles. The annual financial statements shall be audited by accountants selected by the General Partner.

11.6.2    Any Partner shall further have the right to a private audit of the books and records of the Partnership at the expense of such Partner, provided such audit is made for Partnership purposes and is made during normal business hours.

11.7    Access to Books and Records. Any Partner or its duly authorized representative, upon paying the costs of collection, duplication and mailing, shall be entitled to inspect or copy such records during ordinary business hours. Notwithstanding the foregoing, the General Partner, in its sole discretion, may restrict receipt of the information identified in Section 11.1, if the General Partner reasonably believes that disclosure of such information is not in the best interest of the Partnership or could damage the Partnership or the General Partner or its business or the requesting Limited Partner’s reason for obtaining the applicable information is, in the General Partner’s sole discretion, related to the Limited Partner’s individual purposes and not for a Partnership purpose.

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12.    Amendment of Agreement; Merger.

12.1    Amendment Related to Merger. The General Partner’s consent shall be required for any amendment to this Agreement. The General Partner, without the consent of any Limited Partner (other than the Special Limited Partner if such amendment adversely affects the economic rights of the Special Limited Partner), may amend this Agreement in any respect or merge or consolidate the Partnership with or into any other partnership or business entity (as defined in Section 17-211 of the Act) in a transaction pursuant to Section 8.1.2, 8.1.3 or 8.1.4; provided, however, that the following amendments and any other merger or consolidation of the Partnership shall require a Majority Vote:

12.1.1    any amendment affecting the operation of the Conversion Factor or the Exchange Right (except as provided in Section 9.4.4 or 8.1.4) in a manner adverse to the Common Limited Partners;

12.1.2    any amendment that would adversely affect the rights of the Common Limited Partners to receive the distributions payable to them hereunder, other than with respect to the issuance of additional Participating Partnership Units and Preferred Units pursuant to Section 4;

12.1.3    any amendment that would alter the Partnership’s allocations of Net Income and Net Loss to the Limited Partners, other than with respect to the issuance of additional Participating Partnership Units and Preferred Units pursuant to Section 4; or

12.1.4    any amendment that would impose on the Limited Partners any obligation to make additional Capital Contributions to the Partnership.

12.2    Amendment Without the Consent of the Limited Partners. The ability of the General Partner to amend this Agreement without the consent of the Limited Partners, pursuant to Section 12.1, includes, but is not limited to, any amendment to:

12.2.1    add or modify a distribution reinvestment plan for the General Partner or the Partnership;

12.2.2    modify the allocation provisions of the Agreement to comply with Code Section 704(b) or 704(c);

12.2.3    add to the representations, duties, services or obligations of the General Partner or any Affiliates for the benefit of the Limited Partners;

12.2.4    cure any ambiguity or mistake, correct or supplement any provision in the Agreement that may be inconsistent with any other provision, or make any other provision with respect to matters or questions arising under the Agreement that will not be inconsistent with the provisions of the Agreement;

12.2.5    amend the Agreement to reflect the addition or substitution of Limited Partners or the reduction of the Capital Accounts upon the return of capital to the Limited Partners;

12.2.6    minimize the adverse impact of, or comply with, any “plan assets” for ERISA purposes;

12.2.7    execute, acknowledge and deliver any and all instruments to effectuate the foregoing, including the execution, acknowledgment and delivery of any such instrument by the attorney-in-fact for the General Partner under a special or limited power of attorney and to take all such actions in connection therewith as the General Partner deems necessary or appropriate with the signature of the General Partner acting alone;

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12.2.8    change the name and/or principal place of business of the Partnership;

12.2.9    decrease the rights and powers of the General Partner (so long as such decrease does not impair the ability of the General Partner to manage the Partnership and conduct its business affairs);

12.2.10    sell preferred units and other securities and admit preferred limited partners and other limited partners to the Partnership;

12.2.11    make any changes necessary or advisable to enable the General Partner to qualify or maintain its status as a REIT;

12.2.12    establish or amend exchange rights for the exchange of Units for an equivalent number of REIT Shares;

12.2.13    establish or amend a Unit repurchase program; or

12.2.14    make any changes necessary or advisable to satisfy concerns of the Commission, any state securities regulator or any stock exchange in connection with a securities offering by the General Partner or otherwise.

12.2.15    No amendment will be adopted pursuant to Sections 12.2.10 or 12.2.14 without the consent of the Limited Partners unless the adoption thereof (i) is for the benefit of and not adverse to the interests of the Limited Partners and (ii) does not affect the limited liability of the Limited Partners or the status of the Partnership as a partnership for federal income tax purposes.

12.3    Meetings of Partners.

12.3.1    The Partners may but shall not be required to hold any annual, periodic or other formal meetings. Meetings of the Partners may be called by the General Partner, the Special Limited Partner or by any Limited Partner or Limited Partners holding at least 25% of the Common Units in the Partnership.

12.3.2    The Partner or Partners calling the meeting may designate any place within the State of Delaware as the place of meeting for any meeting of the Partners; and Partners holding at least a majority of the Participating Partnership Units in the Partnership or the General Partner may designate any place outside the State of Delaware as the place of meeting for any meeting of the Partners. If no designation is made, or if a special meeting is called, the place of meeting shall be the principal place of business of the Partnership.

12.3.3    Except as provided in Section 12.3.4, written notice stating the place, day and hour of the meeting and the purpose or purposes for which the meeting is called shall be delivered not less than 10 nor more than 90 days before the date of the meeting, either personally or by mail, by or at the direction of the Partner or Partners calling the meeting, to each Partner entitled to vote at such meeting and to each Partner not entitled to vote who is entitled to notice of the meeting.

12.3.4    Anything in this Agreement to the contrary notwithstanding, with respect to any meeting of the Partners, any Partner who in person or by proxy shall have waived in writing notice of the meeting, either before or after such meeting, or who shall attend the meeting in person or by proxy, shall

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be deemed to have waived notice of such meeting unless such Partner attends for the express purpose of objecting, at the beginning of the meeting, and does so object to the transaction of any business because the meeting is not lawfully called or convened.

12.3.5    If all of the Partners shall meet at any time and place, either within or outside of the State of Delaware, in person or by proxy, and consent to the holding of a meeting at such time and place, such meeting shall be valid without call or notice, and at such meeting lawful action may be taken.

12.3.6    For the purpose of determining Partners entitled to notice of or to vote at any meeting of Partners or any adjournment thereof, the date on which notice of the meeting is mailed shall be the record date. When a determination of Partners entitled to vote at any meeting of Partners has been made as provided in this Section, such determination shall apply to any adjournment thereof.

12.3.7    Partners holding at least a Majority Vote, or Preferred Units if applicable, entitled to vote at a meeting, represented in person or by proxy, shall constitute a quorum at any meeting of Partners. In the absence of a quorum at any such meeting, Partners holding at least a Majority Vote, or Preferred Units if applicable, so represented may adjourn the meeting to another time and place. Any business that might have been transacted at the original meeting may be transacted at any adjourned meeting at which a quorum is present. No notice of an adjourned meeting need be given if the time and place are announced at the meeting at which the adjournment is taken unless the adjournment is for more than 120 days. The Partners present at a duly organized meeting may continue to transact business until adjournment, notwithstanding the withdrawal during such meeting of that number of Participating Partnership Units (other than LTIP Units), or Preferred Units if applicable, whose absence would cause less than a quorum to be present.

12.3.8    If a quorum is present, the affirmative vote of Partners holding a majority of the Participating Partnership Units (other than LTIP Units), or Preferred Units if applicable, entitled to vote, present in person or represented by proxy, shall be binding on all Partners, unless the vote of a greater or lesser proportion or number of Participating Partnership Units (other than LTIP Units), or Preferred Units if applicable, or Partners is otherwise required by applicable law or by this Agreement. Unless otherwise expressly provided herein or required under applicable law, Partners who have an interest (economic or otherwise) in the outcome of any particular matter upon which the Partners’ vote or consent is required may vote or consent upon any such matter and their Participating Partnership Units’ (other than LTIP Units), or Preferred Units if applicable, vote or consent, as the case may be, shall be counted in the determination of whether the requisite matter was approved by the Partners.

12.3.9    At all meetings of Partners, a Partner may vote in person or by proxy executed in writing by the Partner or by the Partner’s duly authorized attorney-in-fact. Such proxy shall be filed with the General Partner before or at the time of the meeting. No proxy shall be valid after eleven months from the date of its execution, unless otherwise provided in the proxy.

12.3.10    Action required or permitted to be taken at a meeting of Partners may be taken without a meeting if the action is evidenced by one or more written consents or approvals describing the action taken and signed by Partners holding sufficient Participating Partnership Units (other than LTIP Units), or Preferred Units if applicable, as the case may be, to approve such action had such action been properly voted on at a duly called meeting of the Partners. Action taken under this Section 12.3.10 is effective when the requisite Partners or Partners with the requisite Participating Partnership Units (other than LTIP Units), or Preferred Units if applicable, as the case may be, have signed the consent or approval, unless the consent specifies a different effective date.

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12.3.11    In the event this Agreement or applicable law requires the approval of, or other action to be taken by, any separate class or series of Preferred Units, references in this Section 12.3 to the Preferred Units shall mean such separate class or series.

13.    Term and Dissolution.

13.1    The Partnership shall have a perpetual duration, except that the Partnership shall be dissolved and liquidated upon the first to occur of any of the following events:

13.1.1    The occurrence of an Event of Bankruptcy as to a General Partner or the dissolution (without reconstitution), death, removal or withdrawal of a General Partner unless the business of the Partnership is continued pursuant to Section 8.3.2; provided that if a General Partner is a partnership on the date of such occurrence, the dissolution (without reconstitution) of such General Partner as a result of the dissolution (without reconstitution), death, withdrawal, removal or Event of Bankruptcy of a partner in such partnership shall not be an event of dissolution of the Partnership if the business of such General Partner is continued by the remaining partner or partners, either alone or with additional partners, and such General Partner and such partners comply with any other applicable requirements of this Agreement;

13.1.2    The passage of 90 days after the sale or other disposition (but not a transfer to a GP Subsidiary where the interests are held by the Partnership) of all or substantially all of the assets of the Partnership (provided that if the Partnership receives an installment obligation as consideration for such sale or other disposition, the Partnership shall continue, unless sooner dissolved under the provisions of this Agreement, until such time as such obligation is paid in full); or

13.1.3    The determination by the General Partner that the Partnership should be dissolved.

13.2    Upon dissolution of the Partnership (unless the business of the Partnership is continued pursuant to Section 8.3.2, the General Partner (or its trustee, receiver, successor or legal representative) shall amend or cancel any Certificate and liquidate the Partnership’s assets and apply and distribute the proceeds thereof in accordance with Section 13.4. Notwithstanding the foregoing, the liquidating General Partner may either (i) defer liquidation of, or withhold from distribution for a reasonable time, any assets of the Partnership (including those necessary to satisfy the Partnership’s debts and obligations) or (ii) distribute the assets in accordance with Section 13.4.

13.3    Certificate of Cancellation. As soon as possible following the occurrence of any of the events specified in Section 13.1, the General Partner who has not wrongfully dissolved the Partnership or, if none, the Limited Partners, shall execute and file a Certificate of Cancellation with the Office of the Secretary of State of the State of Delaware in such form as shall be required by the Act.

13.4    Liquidation of Property. Upon a dissolution and termination of the Partnership, the General Partner (or in case there is no General Partner, the Limited Partners or Person designated by a Majority Vote) shall take full account of the Partnership Property and liabilities, shall liquidate the Property as promptly as is consistent with obtaining the fair market value thereof, and shall apply and distribute the proceeds therefrom in accordance with Section 6.7.

13.5    Distributions Upon Dissolution. Each Partner shall look solely to the assets of the Partnership for all distributions and its Capital Contributions, and shall have no recourse therefor (upon dissolution or otherwise) against the General Partner or any Limited Partner. No Partner shall be required to restore any deficit in the Partner’s Capital Account.

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14.    Power of Attorney.

14.1.1    Each Limited Partner and any assignee constitutes and appoints the General Partner and the authorized officers and attorneys-in-fact of each of the foregoing, and each of those acting singly, in each case with full power of substitution, as its true and lawful agent and attorney-in-fact, with full power and authority in its name, place and stead to:

(a)    execute, swear to, acknowledge, deliver, file and record in the appropriate public offices (i) all certificates, documents and other instruments (including, without limitation, this Agreement and the Certificate and all amendments or restatements thereof) that the General Partner deems appropriate or necessary to form, qualify or continue the existence or qualification of the Partnership as a limited partnership (or a partnership in which the Limited Partners have limited liability) in the State of Delaware and in all other jurisdictions in which the Partnership may conduct business or own property, (ii) all instruments that the General Partner deems appropriate or necessary to reflect any amendment, change, modification or restatement of this Agreement duly adopted in accordance with the terms of this Agreement, (iii) all conveyances and other instruments or documents that the General Partner or any liquidator deems appropriate or necessary to reflect the distribution or exchange of assets of the Partnership pursuant to the terms of this Agreement, (iv) all instruments relating to the admission, withdrawal, removal or substitution of any Partner pursuant to, or other events described in, Sections 10 and 13 or the Capital Contributions of any Partner and (v) all certificates, documents and other instruments relating to the determination of the rights, preferences and privileges of Partnership Interests; and

(b)    execute, swear to, seal, acknowledge and file all ballots, consents, approvals, waivers, certificates and other instruments appropriate or necessary, in the sole and absolute discretion of the General Partner to make, evidence, give, confirm or ratify any vote, consent, approval, agreement or other action that is made or given by the Partners hereunder or is consistent with the terms of this Agreement or appropriate or necessary, in the sole discretion of the General Partner or any liquidator, to effectuate the terms or intent of this Agreement. Nothing contained herein shall be construed as authorizing the General Partner to amend this Agreement except in accordance with Section 12 or as may be otherwise expressly provided for in this Agreement.

14.1.2    The foregoing power of attorney is hereby declared to be irrevocable and a power coupled with an interest, in recognition of the fact that each of the Partners will be relying upon the power of the General Partner to act as contemplated by this Agreement in any filing or other action by it on behalf of the Partnership, and it shall survive and not be affected by the subsequent incapacity of any Limited Partner or any assignee or the Transfer of all or any portion of such Limited Partner’s or assignee’s Partnership Units and shall extend to such Limited Partner’s or any assignee’s heirs, successors, assigns and personal representatives. Each such Limited Partner or any assignee hereby agrees to be bound by any representation made by the General Partner, acting in good faith pursuant to such power of attorney; and each such Limited Partner or any assignee hereby waives any and all defenses which may be available to contest, negate or disaffirm the action of the General Partner, taken in good faith under such power of attorney. Each Limited Partner or any assignee shall execute and deliver to the General Partner, within 15 days after receipt of the General Partner’s request therefor, such further designation, powers of attorney and other instruments as the General Partner or any liquidator, as the case may be, may reasonably deem necessary to effectuate this Agreement and the purposes of the Partnership.

15.    Representations and Warranties.

15.1.1    Each Partner that is an individual (including, without limitation, each Additional Limited Partner or Substituted Limited Partner as a condition to becoming an Additional Limited Partner or a Substituted Limited Partner) represents and warrants to each other Partner that (i) such Partner has

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the legal capacity to enter into this Agreement and perform such Partner’s obligations hereunder and (ii) the consummation of the transactions contemplated by this Agreement to be performed by such Partner will not result in a breach or violation of, or a default under, any agreement by which such Partner or any of such Partner’s property is or are bound, or any statute, regulation, order or other law to which such Partner is subject.

15.1.2    Each Partner that is not an individual (including, without limitation, each Additional Limited Partner or Substituted Limited Partner as a condition to becoming an Additional Limited Partner or a Substituted Limited Partner) represents and warrants to each other Partner that (i) its execution and delivery of this Agreement and all transactions contemplated by this Agreement to be performed by it have been duly authorized by all necessary action, including without limitation, that of any general partner, committee, trustee, beneficiary, director, member and/or stockholder, as the case may be, as required and (ii) the consummation of such transactions shall not result in a breach or violation of, or a default under, its certificate of limited partnership, partnership agreement, trust agreement, limited liability company operating agreement, charter or bylaws, as the case may be, any agreement by which such Partner or any of such Partner’s properties or any of its partners, beneficiaries, trustees, directors, members or stockholders, as the case may be, is or are bound, or any statute, regulation, order or other law to which such Partner or any of its partners, trustees, beneficiaries, directors, members or stockholders, as the case may be, is or are subject.

15.1.3    Each Partner (including, without limitation, each Additional Limited Partner or Substituted Limited Partner as a condition to becoming an Additional Limited Partner or a Substituted Limited Partner) represents and warrants to each other Partner that this Agreement is binding upon, and enforceable against, such Partner in accordance with its terms, as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium or similar laws affecting creditors’ rights generally, as from time to time in effect, or the application of equitable principles.

15.1.4    Each Limited Partner represents and warrants to the General Partner and to the Partnership that the acquisition of its Partnership Interest is made as a principal for its account for investment purposes only and not with a view to the resale or distribution of such Partnership Interest.

15.1.5    Each Partner represents and warrants that at any time such Partner actually owns or constructively owns a 25% or greater capital interest or profits interest in the Partnership, it does not and will not, without the prior written consent of the General Partner, actually own or constructively own (i) with respect to any tenant that is a corporation, any stock of such tenant and (ii) with respect to any tenant that is not a corporation, any interest in either the assets or net profits of such Tenant.

15.1.6    Each Partner represents and warrants that upon request of the General Partner, it will promptly disclose to the General Partner the amount of REIT Shares or other capital shares of the General Partner that it actually owns or constructively owns.

15.1.7    Each Limited Partner represents and warrants that it will not sell, assign or otherwise Transfer its Partnership Interest or any fraction thereof, whether voluntarily or by operation of law or at judicial sale or otherwise, to any Person who does not make the representations and warranties to the General Partner set forth in Section 15.1.4 above and similarly agree not to sell, assign or Transfer such Partnership Interest or fraction thereof to any Person who does not similarly represent, warrant and agree.

15.1.8    Each Partner understands that if, for any reason, (i) the representations, warranties or agreements set forth above are violated or (ii) the Partnership’s actual or constructive ownership of REIT Shares or other capital shares of the General Partner violates the limitations set forth

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in the Articles of Incorporation, then (x) the Exchange Right may become non-exercisable and (y) some or all of the REIT Shares owned by the Partners may be automatically transferred to a trust for the benefit of a charitable beneficiary as provided in the Articles of Incorporation.

15.1.9    The representations and warranties contained in this Section 15.1 shall survive the execution and delivery of this Agreement by each Partner (and, in the case of an Additional Limited Partner or a Substituted Limited Partner, the admission of such Additional Limited Partner or Substituted Limited Partner as a Limited Partner in the Partnership) and the dissolution and winding up of the Partnership.

16.    General Provisions.

16.1    Notices. All communications required or permitted under this Agreement shall be in writing and shall be deemed to have been given when delivered personally or upon deposit in the United States mail, registered, postage prepaid return receipt requested, to the Partners at the addresses set forth on Exhibit A; provided, however, that any Partner may specify a different address by notifying the General Partner in writing of such different address. Notices to the Partnership shall be delivered at or mailed to its specified office.

16.2    Survival of Rights. Subject to the provisions hereof limiting transfers, this Agreement shall be binding upon and inure to the benefit of the Partners and the Partnership and their respective legal representatives, successors, transferees and assigns.

16.3    Additional Documents. Each Partner agrees to perform all further acts and execute, swear to, acknowledge and deliver all further documents which may be reasonable, necessary, appropriate or desirable to carry out the provisions of this Agreement or the Act.

16.4    Severability. If any provision of this Agreement shall be declared illegal, invalid, or unenforceable in any jurisdiction, then such provision shall be deemed to be severable from this Agreement (to the extent permitted by law) and in any event such illegality, invalidity or unenforceability shall not affect the remainder hereof.

16.5    Entire Agreement. This Agreement and attached exhibits constitute the entire agreement of the Partners and supersede all prior written agreements and prior and contemporaneous oral agreements, understandings and negotiations with respect to the subject matter hereof.

16.6    Pronouns and Plurals. When the context in which words are used in this Agreement indicates that such is the intent, words in the singular number shall include the plural and the masculine gender shall include the neuter or female gender as the context may require.

16.7    Headings. The Section headings or Sections in this Agreement are for convenience only and shall not be used in construing the scope of this Agreement or any particular Section.

16.8    Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed to be an original copy and all of which together shall constitute one and the same instrument binding on all parties hereto, notwithstanding that all parties shall not have signed the same counterpart.

16.9    Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware; provided, however, that any cause of action for any violation of federal or state securities laws shall not be governed by this Section 16.9.

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16.10    Electronic Signatures. Any electronic signature of a party to this Agreement and of a party to take any action related to this Agreement or any agreement entered into by the Partnership shall be valid as an original signature and shall be effective and binding. Any such electronic signature (including the signature(s) to this Agreement) shall be deemed (i) to be “written” or “in writing,” (ii) to have been signed and (iii) to constitute a record established and maintained in the ordinary course of business and an original written record when printed from electronic files.

[SIGNATURES ON FOLLOWING PAGE]

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IN WITNESS WHEREOF, the parties hereto have hereunder affixed their signatures to this Amended and Restated Limited Partnership Agreement, all as of February 1, 2020.

GENERAL PARTNER:
Cottonwood Communities, Inc., a Maryland corporation
By:	/s/ Gregg Christensen
Name:	Gregg Christensen
Title:	Executive Vice President

SPECIAL LIMITED PARTNER:
Cottonwood Communities Investors, LLC, a Delaware limited liability company
By:	Cottonwood Residential O.P., LP, a Delaware limited partnership, its sole member
	By:	Cottonwood Residential II, Inc., a Maryland corporation, its general partner
		By:	/s/ Gregg Christensen
		Name:	Gregg Christensen
		Title:	Chief Legal Officer

[Signature Page to Amended and Restated Limited Partnership Agreement of

Cottonwood Communities O.P., LP]

EXHIBIT A

PARTNERS’ CAPITAL CONTRIBUTIONS AND PERCENTAGE INTERESTS

Partner	Interests	Percentage Interest
GENERAL PARTNER
Cottonwood Communities, Inc. 6340 South 3000 East, Suite 500 Salt Lake City, Utah 84121	[On file with the Partnership]		[	]%
SPECIAL LIMITED PARTNER
Cottonwood Communities Investor, LLC 6340 South 3000 East, Suite 500 Salt Lake City, Utah 84121	[On file with the Partnership]
COMMON LIMITED PARTNERS
[N/A]	[N/A]		0	%
SERIES 2019 PREFERRED LIMITED PARTNERS
Cottonwood Communities, Inc. 6340 South 3000 East, Suite 500 Salt Lake City, Utah 84121	[On file with the Partnership]

Exhibit A

EXHIBIT B

NOTICE OF EXERCISE OF EXCHANGE RIGHT

In accordance with Section 9.4 of the Amended and Restated Limited Partnership Agreement (the “Agreement”) of Cottonwood Communities O.P., LP, the undersigned hereby irrevocably (i) presents for exchange                      Common Units in Cottonwood Communities O.P., LP, in accordance with the terms of the Agreement and the Exchange Right referred to in Section 9.4, (ii) surrenders such Common Units and all right, title and interest therein and (iii) directs that the Cash Amount or REIT Shares Amount (as defined in the Agreement) as determined by the General Partner deliverable upon exercise of the Exchange Right be delivered to the address specified below, and if REIT Shares (as defined in the Agreement) are to be delivered, such REIT Shares be registered or placed in the name(s) and at the address(es) specified below.

Dated:             ,	(Name of Limited Partner)
	By:
		(Signature of Limited Partner)
	Mailing Address:
	(City)                          (State)                                                  Zip Code
	Signature Guaranteed by:

If REIT Shares are to be issued, issue to:

Name

Social Security or Tax I.D. Number

Exhibit B

EXHIBIT C

CALL NOTICE

In accordance with the Amended and Restated Agreement of Limited Partnership of Cottonwood Communities O.P., LP (the “Agreement”), the undersigned hereby irrevocably exercises its Call Right (as defined in the Agreement) with regard to all of the [Common Units/LTIP Units] (the “Called Units”) owned by the undersigned (the “Called Partner”) in Cottonwood Communities O.P., LP. The undersigned shall pay the [Cash Amount/REIT Shares Amount] to the Called Partner at the notice address of the Called Partner provided in the Agreement upon receipt of (i) an assignment of the Called Units duly executed by the Called Partner transferring all right, title and interest in the Called Units to the undersigned along with any certificate evidencing such Called Units, (ii) if REIT Shares are to be delivered, instructions as to the name, address and taxpayer identification number of the person to whom such REIT Shares will be registered or placed and (iii) the representation, warranty and certification of the Called Partner that such Called Partner (a) has marketable and unencumbered title to its Called Units, free and clear of any liens or the rights or interest of any other person or entity, (b) has the full right, power and authority to transfer and surrender such Called Units as provided herein and (c) has obtained the consent or approval of all persons or entities, if any, having the right to consent to or approve of such transfer and surrender.

Cottonwood Communities, Inc., a Maryland corporation

By:

Printed Name:

Title:

Exhibit C

EXHIBIT D

PARTNERSHIP UNIT DESIGNATION OF LTIP UNITS

1.    Designation and Number; Definitions.

A class of Partnership Units in the Partnership designated as the “LTIP Units” is hereby established, and the number of Partnership Units constituting such class shall not be greater than [                    ]. Except to the extent a capital contribution is made with respect to an LTIP Unit, each LTIP Unit is intended to qualify as a “profits interest” in the Partnership. The following defined terms used in this Exhibit D shall have the meanings specified below:

“Capital Transaction” has the meaning set forth in Section 12.1 of this Designation.

“Designation” shall mean this Partnership Unit Designation of LTIP Units.

“LTIP Unit Adjustment Events” has the meaning set forth in Section 8 of this Designation.

“LTIP Unit Conversion Date” has the meaning set forth in Section 9 of this Designation.

“Unvested LTIP Units” has the meaning set forth in Section 3 of this Designation.

“Vested LTIP Units” has the meaning set forth in Section 3 of this Designation.

“Vesting Agreement” has the meaning set forth in Section 3 of this Designation.

2.    Ranking.

2.1    Except as otherwise provided in this Designation or elsewhere in the Agreement, the LTIP Units shall, with respect to distribution rights and rights upon voluntary or involuntary liquidation, winding up or dissolution of the Partnership, rank (i) on a parity with the Common Units and (ii) junior to all Partnership Units which rank senior to the Common Units.

2.2    The General Partner may, at any time and from time to time, determine to issue LTIP Units in accordance with Section 4.3 of the Agreement. In connection with any such issuance, the General Partner shall (i) determine the amount of the Capital Contribution (if any) to be made in connection with such issuance and the manner in which such Capital Contribution shall be made and (ii) make such revisions to the Agreement as it determines are appropriate to reflect the issuance of such LTIP Units. Upon the issuance of LTIP Units, the holder of such LTIP Units shall be admitted to the Partnership as an Additional Limited Partner upon furnishing to the General Partner (A) evidence of acceptance in form satisfactory to the General Partner and (B) such other documents or instruments as may be required in the discretion of the General Partner in order to effect such Person’s admission as an Additional Limited Partner. The admission of an Additional Limited Partner shall become effective on the date upon which the name of such person is recorded by the General Partner in the books and records of the Partnership.

3.    Vesting.

LTIP Units may, in the sole discretion of the General Partner, be issued subject to vesting, forfeiture and additional restrictions on transfer pursuant to the terms of an award, vesting or other similar agreement (a “Vesting Agreement”). The terms of any Vesting Agreement may be modified by the

Exhibit D

General Partner from time to time in its sole discretion, subject to any restrictions on amendment imposed by the relevant Vesting Agreement or by the terms of any plan pursuant to which the LTIP Units are issued, if applicable. LTIP Units that have vested and are no longer subject to forfeiture under the terms of a Vesting Agreement are referred to as “Vested LTIP Units”; all other LTIP Units are referred to as “Unvested LTIP Units.” Subject to the terms of any Vesting Agreement, a holder of LTIP Units shall be entitled to transfer his or her LTIP Units to the same extent, and subject to the same restrictions as holders of Common Units are entitled to transfer their Common Units pursuant to Section 10 of the Agreement.

4.    Forfeiture or Transfer of Unvested LTIP Units.

Unless otherwise specified in the relevant Vesting Agreement, upon the occurrence of any event specified in a Vesting Agreement as resulting in either the forfeiture of any LTIP Units, or the repurchase by the Partnership or the General Partner of LTIP Units at a specified purchase price, then, upon the occurrence of the circumstances resulting in such forfeiture or repurchase by the Partnership or the General Partner, the relevant LTIP Units shall immediately, and without any further action, be treated as cancelled and no longer outstanding for any purpose, or as transferred to the Partnership or General Partner, as applicable. Unless otherwise specified in the Vesting Agreement, no consideration or other payment shall be due with respect to any LTIP Units that have been forfeited, other than any distributions declared with a record date prior to the effective date of the forfeiture.

5.    Legend.

The books and records of the Partnership as maintained by the General Partner or by its agent (or if applicable any certificate evidencing an LTIP Unit) shall bear an appropriate notation or legend indicating that additional terms, conditions and restrictions on transfer, including without limitation those set forth in a Vesting Agreement, apply to LTIP Units.

6.    Distributions.

The distributions to which holders of LTIP Units will be entitled with respect to their LTIP Units will be determined in accordance with the terms of the Agreement, including, without limitation, Section 6 of the Agreement.

7.    Allocations.

The allocations to which holders of LTIP Units will be entitled with respect to their LTIP Units will be determined in accordance with the terms of the Agreement, including, without limitation, Section 5 of the Agreement.

8.    Adjustments.

Unless otherwise provided by the terms of a specific series of LTIP Units, as approved by the General Partner, the General Partner shall maintain a one-to-one correspondence between Common Units and LTIP Units upon events (“LTIP Unit Adjustment Events”) such as distributions on all outstanding Common Units in additional Partnership Units, subdivision, combination, reclassification or recapitalization of the Common Units. If more than one such event triggers an adjustment, the adjustment to the LTIP Units need be made only once using a single formula that takes into account the multiple events as if they all occurred simultaneously. If in the opinion of the General Partner an adjustment to the LTIP Units is required to maintain the same correspondence between Common Units and LTIP Units after an event such as those described in the first sentence of this Section 8 of this Designation as existed prior to such event, the General Partner shall make such adjustment to the extent permitted by the

Exhibit D

Agreement, by law and by the terms of any plan pursuant to which the LTIP Units have been issued in such manner and at such time as the General Partner, in its sole discretion, may determine to be appropriate under the circumstances to maintain such correspondence. If an adjustment is made to the LTIP Units as herein provided, the Partnership shall promptly (i) file in the books and records of the Partnership an officer’s certificate setting forth such adjustment and a brief statement of the facts requiring such adjustment, which certificate shall be conclusive evidence of the correctness of such adjustment absent manifest error, and (ii) give notice thereof to the holders of LTIP Units affected thereby.

9.    General Partner Initiated Conversion.

Each LTIP Unit shall, upon the later to occur of (i) the LTIP Unit becoming a Vested LTIP Unit and (ii) the Book-Up Target of the LTIP Unit equaling zero (such date, the “LTIP Unit Conversion Date”), automatically and without further action by a holder convert into a Common Unit, after giving effect to all adjustments (if any) made pursuant to Section 8 of this Designation, and the General Partner shall reflect such conversion in the records of the Partnership. The General Partner shall maintain internal controls to track the automatic conversion of LTIP Units described in this Section 9 of this Designation.

10.    Conversion Procedures.

A conversion of Vested LTIP Units shall occur automatically after the close of business on the applicable LTIP Unit Conversion Date without any action on the part of such holder of LTIP Units, as of which time such holder of LTIP Units shall be credited on the books and records of the Partnership with the issuance as of the opening of business on the next day of the number of Common Units issuable upon such conversion. After the conversion of LTIP Units as aforesaid, the Partnership shall deliver to such holder of LTIP Units, upon his or her written request, a certificate of the General Partner certifying the number of Common Units and remaining LTIP Units, if any, held by such Person immediately after such conversion.

11.    Treatment of Capital Account.

For purposes of making future allocations under Section 5 of the Agreement, as amended from time to time, the portion of the Economic Capital Account Balance of the applicable holder of LTIP Units that is treated as attributable to his or her LTIP Units shall be reduced, as of the date of conversion, by the product of the number of LTIP Units converted and the Common Unit Economic Balance.

12.    Mandatory Conversion in Connection with a Capital Transaction.

12.1    If the Partnership or the General Partner shall be a party to any transaction (including without limitation a merger, consolidation, unit exchange, self-tender offer for all or substantially all Common Units or other business combination or reorganization, or sale of all or substantially all of the Partnership’s assets, but excluding any transaction which constitutes an LTIP Unit Adjustment Event), in each case as a result of which Common Units shall be exchanged for or converted into the right to receive, or the holders of Common Units shall otherwise be entitled to receive cash, securities or other property or any combination thereof (each of the foregoing being referred to herein as a “Capital Transaction”), then the LTIP Units then eligible for conversion under Section 9 of this Designation, taking into account any allocations that occur in connection with the Capital Transaction or that would occur in connection with the Capital Transaction if the assets of the Partnership were sold for the consideration provided in the agreement or agreements with respect to the Capital Transaction or, if applicable, at a value determined by the General Partner in good faith using the value attributed to the Partnership Units in the context of the Capital Transaction (in which case the LTIP Unit Conversion Date shall be the effective date of the Capital Transaction and the conversion shall occur immediately prior to the effectiveness of the Capital Transaction) shall convert into a Common Unit under Section 9 of this Designation.

Exhibit D

12.2    In anticipation of such LTIP Unit Conversion in Section 12.1 of this Designation and the consummation of the Capital Transaction, the Partnership shall use commercially reasonable efforts to cause each holder of LTIP Units to be afforded the right to receive in connection with such Capital Transaction in consideration for the Common Units into which his or her LTIP Units will be converted pursuant to this Section 12 of this Designation the same kind and amount of cash, securities and other property (or any combination thereof) receivable upon the consummation of such Capital Transaction by a holder of the same number of Common Units, assuming such holder of Common Units is not a Person with which the Partnership consolidated or into which the Partnership merged or which merged into the Partnership or to which such sale or transfer was made, as the case may be (a “Constituent Person”), or an Affiliate of a Constituent Person. In the event that holders of Common Units have the opportunity to elect the form or type of consideration to be received upon consummation of the Capital Transaction, prior to such Capital Transaction the General Partner shall give prompt written notice to each holder of LTIP Units of such election, and shall use commercially reasonable efforts to afford such holders the right to elect, by written notice to the General Partner, the form or type of consideration to be received upon conversion pursuant to this Section 12 of this Designation of each LTIP Unit held by such holder into Common Units in connection with such Capital Transaction. If a holder of LTIP Units fails to make such an election, such holder (and any of its transferees) shall receive upon conversion pursuant to this Section 12 of this Designation of each LTIP Unit held by him or her (or by any of his or her transferees) the same kind and amount of consideration that a holder of a Common Unit would receive if such holder of Common Units failed to make such an election.

12.3    Subject to the rights of the Partnership and the General Partner under any Vesting Agreement and the terms of any plan under which LTIP Units are issued, the Partnership shall use commercially reasonable efforts to cause the terms of any Capital Transaction to be consistent with the provisions of this Section 12 of this Designation and to enter into an agreement with the successor or acquiring entity, as the case may be, for the benefit of the holders of LTIP Units whose LTIP Units will not be converted into Common Units in connection with the Capital Transaction that will contain provisions enabling the holders of LTIP Units that remain outstanding after such Capital Transaction to preserve, as far as reasonably possible under the circumstances, the distribution, special allocation, conversion, and other rights set forth in this Designation and the Agreement (such agreement, a “Continuation Agreement”). If the Partnership is unable to enter into a Continuation Agreement with the successor or acquiring entity, as the case may be, the Partnership will purchase any remaining Vested LTIP Units for the Cash Amount.

12.4    To the extent a Capital Transaction is also a General Partner Liquidity Event pursuant to the Agreement and this Section 12 of this Designation is inconsistent with Section 9.5 of the Agreement with respect to the treatment of LTIP Units, this Section 12 of this Designation shall control.

13.    Redemption Right of LTIP Unit Limited Partners.

13.1    Subject to Sections 9.5 and 9.6 of the Agreement, LTIP Units will not be redeemable at the option of the Partnership; provided, however, that the foregoing shall not prohibit the Partnership from repurchasing LTIP Units from the holder thereof if and to the extent such holder agrees to sell such LTIP Units.

13.2    Except as otherwise set forth in the relevant Vesting Agreement or other separate agreement entered into between the Partnership and a LTIP Unit Limited Partner, and subject to the terms

Exhibit D

and conditions set forth herein, in the Agreement or the terms of a specific series of LTIP Units as approved by the General Partner, on or at any time after the applicable LTIP Unit Conversion Date each LTIP Unit Limited Partner will have the same right (and subject to the same terms and conditions and to be effected in the same manner) to (i) require the Partnership to redeem all or a portion of the Common Units (but not LTIP Units) into which such LTIP Unit Limited Partner’s LTIP Units were converted as the other holders of Common Units in accordance with Section 9.4 of the Agreement and (ii) request the Partnership to repurchase all or a portion of the Common Units (but not LTIP Units) into which such LTIP Unit Limited Partner’s LTIP Units were converted as the other holders of Common Units in accordance with Section 9.4 of the Agreement.

14.    Voting Rights.

Holders of LTIP Units, whether vested or unvested, shall not have any voting rights other than as provided in Section 15 of this Designation.

15.    Special Approval Rights.

15.1    Holders of LTIP Units shall only (i) have those voting rights required from time to time by non-waivable provisions of applicable law, if any, and (ii) have the additional voting rights that are expressly set forth in this Section 15 of this Designation. The General Partner and/or the Partnership shall not, without the affirmative vote of holders of more than 50% of the then outstanding LTIP Units (both vested (but not yet converted) and unvested) affected thereby, given in person or by proxy, either in writing or at a meeting (voting separately as a class), take any action that would materially and adversely alter, change, or amend, whether by merger, consolidation or otherwise, the rights, powers or privileges of such LTIP Units, subject to the following exceptions:

15.1.1    no separate consent of the holders of LTIP Units will be required if and to the extent that any such alteration, change, or amendment would, in a ratable and proportional manner, alter, change, or amend the rights, powers or privileges of the Common Units;

15.1.2    a merger, consolidation or other business combination or reorganization of the Partnership, the General Partner or any of their Affiliates shall not be deemed to materially and adversely alter, change, or amend the rights, powers or privileges of the LTIP Units, so long as either (i) the LTIP Units that are then eligible for conversion (or that the General Partner provides will be eligible for conversion in connection with the merger, consolidation or other business combination or reorganization) are converted into Common Units immediately prior to the effectiveness of the transaction, (ii) the holders of LTIP Units either will receive, or will have the right to elect to receive, for each LTIP Unit an amount of cash, securities, or other property equal to the amount of cash, securities or other property that would be paid in respect of such LTIP Unit had it been converted into Common Units (or a fraction thereof, as applicable, under the terms provided by the terms of a specific series of LTIP Units as approved by the General Partner), (iii) the LTIP Units remain outstanding with their terms materially unchanged or (iv) if the Partnership is not the surviving entity in the merger, consolidation or other business combination or reorganization, the LTIP Units are exchanged for a security of the surviving entity with terms that are materially the same with respect to rights to allocations, distributions, redemption, conversion and voting as the LTIP Units.

15.1.3    any creation or issuance of Partnership Units (whether ranking junior to, on a parity with or senior to the LTIP Units in any respect), which either (i) does not require a Majority Vote or (ii) does require such consent and is authorized by a Majority Vote, together with any other class or series of units of Limited Partner Interest in the Partnership upon which like voting rights have been conferred, shall not be deemed to materially and adversely alter, change, or amend the rights, powers or privileges of the LTIP Units; and

Exhibit D

15.1.4    any waiver by the Partnership of restrictions or limitations applicable to any outstanding LTIP Units with respect to any holder or holders thereof shall not be deemed to materially and adversely alter, change, or amend the rights, powers or privileges of the LTIP Units with respect to other holders. For the avoidance of doubt, the General Partner in its sole discretion may waive any restrictions or limitations (including vesting restrictions or transfer restrictions) applicable to any outstanding LTIP Units with respect to any holder or holders at any time and from time to time. Any such determination in the General Partner’s discretion in respect of such LTIP Units shall be final and binding. Such determinations need not be uniform and may be made selectively among holders of LTIP Units, whether or not such holders are similarly situated, and shall not constitute the breach of any duty hereunder or otherwise existing at law, in equity or otherwise.

15.2    Notwithstanding the above, (i) if the holders of more than 50% of the then outstanding LTIP Units (both vested (but not yet converted) and unvested) do not provide affirmative votes pursuant to Section 15.1 of this Designation for the action requested or (ii) if the requirements of Section 15.1.1 through 15.1.4 of this Designation cannot be met on a commercially reasonable basis, the Partnership shall have the option to purchase the LTIP Units that are not entitled to be exchanged for the Cash Amount.

15.3    Any special approval rights provided in this Section 15 of this Designation will not apply if, as of or prior to the time when the action with respect to which such vote would otherwise be required will be taken or be effective, all outstanding LTIP Units shall have been converted and/or exchanged, or provision is made for such exchange and/or conversion to occur as of or prior to such time, or all outstanding LTIP Units have been repurchased pursuant to Section 15.2 of this Designation.

16.    Rights to Transfer.

Subject to the terms of the relevant Vesting Agreement or other document pursuant to which LTIP Units are granted, except in connection with the exercise of a LTIP Unit Exchange Right pursuant to Section 9.4 of the Agreement, a transfer of all or any portion of a holder’s LTIP Units will be subject to Section 9 of the Agreement.

Exhibit D

EXHIBIT E

NOTICE OF ELECTION BY PARTNER TO CONVERT LTIP UNITS INTO COMMON UNITS

The undersigned holder of LTIP Units hereby irrevocably elects to convert the number of Vested LTIP Units in Cottonwood Communities O.P., LP (the “Partnership”) set forth below into Common Units in accordance with the terms of the Amended and Restated Limited Partnership Agreement of the Partnership, as amended. The undersigned hereby represents, warrants, and certifies that the undersigned (i) has title to such LTIP Units, free and clear of the rights or interests of any other Person other than the Partnership, (ii) has the full right, power, and authority to cause the conversion of such LTIP Units as provided herein and (iii) has obtained the consent or approval of all persons or entities, if any, having the right to consent or approve such conversion.

Name of Holder:                                                                                                                                                                        

(Please Print: Exact Name as Registered with Partnership)

Number of LTIP Units to be Converted:                                                               

Conversion Date:                                                                                                     

(Signature of Holder: Sign Exact Name as Registered with Partnership)

(Street Address)

(City)                                          (State)                                         (Zip Code)

Exhibit E

EXHIBIT F

NOTICE OF ELECTION BY PARTNERSHIP TO FORCE CONVERSION

OF LTIP UNITS INTO COMMON UNITS

Cottonwood Communities O.P., LP (the “Partnership”) hereby irrevocably elects to cause the number of LTIP Units held by the holder of LTIP Units set forth below to be converted into Common Units in accordance with the terms of the Amended and Restated Limited Partnership Agreement of the Partnership, as amended.

Name of Holder:                                                                                                                                                                                             

(Please Print: Exact Name as Registered with Partnership)

Number of LTIP Units to be Converted:                                                              

Conversion Date:                                                                                                      

Exhibit F

EXHIBIT G

PARTNERSHIP UNIT DESIGNATION OF

THE SERIES 2019 PREFERRED UNITS

1.    Number of Units and Designation.

A class of Preferred Partnership Units is hereby designated as “Series 2019 Preferred Units,” and the number of Preferred Partnership Units constituting such class shall equal 5,000,000.

2.    Definitions.

For purposes of the Series 2019 Preferred Units, the following terms shall have the meanings indicated in this Section 2, and capitalized terms used and not otherwise defined herein shall have the respective meanings assigned thereto in the Agreement:

“Series 2019 Designation” shall mean this Partnership Unit Designation of Series 2019 Preferred Units.

“Series 2019 Distribution Payment Date” shall mean the first day of each month, or if not a business day, the next succeeding business day.

“Series 2019 Junior Partnership Units” has the meaning set forth in paragraph (c) of Section 7 of this Series 2019 Designation.

“Series 2019 Liquidation Preference” has the meaning set forth in paragraph (a) of Section 4 of this Series 2019 Designation.

“Series 2019 Parity Partnership Units” has the meaning set forth in paragraph (b) of Section 7 of this Series 2019 Designation.

“Series 2019 Purchase Price” shall mean $10.00 per Series 2019 Preferred Unit.

“Series 2019 Preferred Unit” means a Preferred Partnership Unit with the designations, preferences and relative, participating, optional or other special rights, powers and duties as are set forth in this Series 2019 Designation. It is the intention of the General Partner that each Series 2019 Preferred Unit shall be substantially the economic equivalent of one share of Series 2019 Preferred Stock.

“Series 2019 Preferred Stock” means the Series 2019 Preferred Stock, par value $0.01 per share, of the General Partner.

“Special Redemption Event” shall mean the date upon which Cottonwood Communities, Inc.’s shares of common stock are listed for trading on a national securities exchange with at least three market makers or a New York Stock Exchange specialist.

3.    Distributions.

On every Series 2019 Distribution Payment Date, the General Partner shall be entitled to receive distributions payable in cash in an amount per Series 2019 Preferred Unit equal to 5.5% cumulative but not compounded per annum return on the Series 2019 Purchase Price (equivalent to a fixed annual rate of $0.55 per Series 2019 Preferred Unit) which will be determined on a daily basis; provided, however, that, if the Series 2019 Preferred Units are outstanding on or after January 1, 2024, such distribution rate shall increase to a 6.0% cumulative but not compounded per annum return on the Series 2019 Purchase Price

Exhibit G

(equivalent to a fixed annual rate of $0.60 per Series 2019 Preferred Unit). Each such distribution shall be payable to the holder of record of the Series 2019 Preferred Units as set forth in the records of the Partnership at the close of business on the record date for the dividend payable with respect to the Series 2019 Preferred Stock on such Distribution Payment Date. The holder of Series 2019 Preferred Units shall not be entitled to any distributions on the Series 2019 Preferred Units, whether payable in cash, property or stock, except as provided herein.

4.    Liquidation Preference.

4.1    In the event of any liquidation, dissolution or winding up of the Partnership, whether voluntary or involuntary, before any payment or distribution of the Partnership (whether capital, surplus or otherwise) shall be made to or set apart for the holders of Series 2019 Junior Partnership Units, the holders of Series 2019 Preferred Units shall be entitled to receive $10.00 per Series 2019 Preferred Unit (the “Series 2019 Liquidation Preference”), plus an amount per Series 2019 Preferred Unit equal to all distributions (whether or not declared or earned) accrued and unpaid on the Series 2019 Preferred Unit; but such holders shall not be entitled to any further payment. Until the holders of the Series 2019 Preferred Units have been paid the Series 2019 Liquidation Preference in full, plus an amount equal to all distributions (whether or not declared or earned) accrued and unpaid on the Series 2019 Preferred Unit to the date of final distribution to such holders, no payment shall be made to any holder of Series 2019 Junior Partnership Units upon the liquidation, dissolution or winding up of the Partnership. If, upon any liquidation, dissolution or winding up of the Partnership, the assets of the Partnership, or proceeds thereof, distributable among the holders of Series 2019 Preferred Units shall be insufficient to pay in full the preferential amount aforesaid and liquidating payments on any Series 2019 Parity Partnership Units, then such assets, or the proceeds thereof, shall be distributed among the holders of Series 2019 Preferred Units and any such Series 2019 Parity Partnership Units ratably in the same proportion as the respective amounts that would be payable on such Series 2019 Preferred Units and any such other Series 2019 Parity Partnership Units if all amounts payable thereon were paid in full.

4.2    Upon any liquidation, dissolution or winding up of the Partnership, after payment shall have been made in full to the holders of Series 2019 Preferred Units and any Series 2019 Parity Partnership Units, as provided in this Section 4, any other series or class or classes of Series 2019 Junior Partnership Units shall, subject to the respective terms thereof, be entitled to receive any and all assets remaining to be paid or distributed, and the holders of the Series 2019 Preferred Units and any Series 2019 Parity Partnership Units shall not be entitled to share therein.

5.    Redemption.

Series 2019 Preferred Units shall be redeemable or by the Partnership as follows:

5.1    Unless the Series 2019 Preferred Units have been earlier redeemed as set forth in Section 5(b) or Section 5(c), on December 31, 2023, the Partnership shall, to the extent there are funds legally available therefor and subject to the preferential rights of the holders of the Partnership Units that have a liquidation preference to the Series 2019 Preferred Units, redeem all of the Series 2019 Preferred Units for cash at a redemption price equal to the Series 2019 Purchase Price plus any accrued but unpaid distributions through the redemption date. Notwithstanding the above, the Partnership may, in the discretion of the General Partner and only if the General Partner has extended the term of the Series 2019 Preferred Stock, extend the redemption date for up to two 1-year periods.

5.2    Subject to Section 5(c), the Partnership may, in the sole discretion of the General Partner, redeem for cash the Series 2019 Preferred Units at any time on or after January 1, 2022, in whole or in part, at a redemption price equal to the Series 2019 Purchase Price plus any accrued but unpaid distributions through the redemption date.

Exhibit G

5.3    In connection with a Special Redemption Event, the Partnership may, in the sole discretion of the General Partner, redeem for cash the Series 2019 Preferred Units at a redemption price equal to the Series 2019 Purchase Price plus any accrued but unpaid distributions through the redemption date.

6.    Cancellation of Units; Status of Reacquired Units.

Upon the reacquisition in any manner by the General Partner of any shares of Series 2019 Preferred Stock, a like number of Series 2019 Preferred Units, automatically and without any further action by the holder of Series 2019 Preferred Units or the Partnership, shall be deemed cancelled. All Series 2019 Preferred Units that have been issued and reacquired in any manner by the Partnership shall be deemed cancelled.

7.    Ranking.

Any class or series of Partnership Units of the Partnership shall be deemed to rank:

7.1    prior or senior to the Series 2019 Preferred Units, as to the payment of distributions and as to distributions of assets upon liquidation, dissolution or winding up, the holders of such class or series shall be entitled to the receipt of distributions or of amounts distributable upon liquidation, dissolution or winding up, as the case may be, in preference or priority to the holders of Series 2019 Preferred Units;

7.2    on a parity with the Series 2019 Preferred Units, as to the payment of distributions and as to distribution of assets upon liquidation, dissolution or winding up, whether or not the distribution rates, distribution payment dates or redemption or liquidation prices per unit or other denomination thereof be different from those of the Series 2019 Preferred Units if the holders of such class or series of Partnership Units and the Series 2019 Preferred Units shall be entitled to the receipt of distributions and of amounts distributable upon liquidation, dissolution or winding up in proportion to their respective amounts of accrued and unpaid distributions per unit or other denomination or liquidation preferences, without preference or priority of one over the other (collectively, the “Series Parity Partnership Units”); and

7.3    junior to the Series 2019 Preferred Units, as to the payment of distributions and as to the distribution of assets upon liquidation, dissolution or winding up, if (i) such class or series of Partnership Units shall be Common Units or (ii) the holders of Series 2019 Preferred Units shall be entitled to receipt of distributions or of amounts distributable upon liquidation, dissolution or winding up, as the case may be, in preference or priority to the holders of such class or series of Partnership Units (the Partnership Units referred to in clauses (i) and (ii) of this paragraph being hereinafter referred to, collectively, as “Series 2019 Junior Partnership Units”).

8.    Special Allocations.

8.1    Gross income and, if necessary, gain shall be allocated to the holder of Series 2019 Preferred Units for any Fiscal Year (and, if necessary, subsequent Fiscal Years) to the extent that the holder of Series 2019 Preferred Units receives a distribution on any Series 2019 Preferred Units (other than for a return of its original Capital Contributions).

8.2    If any Series 2019 Preferred Units are redeemed pursuant to Section 5 hereof, for the Fiscal Year that includes such redemption (and, if necessary, for subsequent Fiscal Years) (a) gross income and gain (in such relative proportions as the General Partner in its discretion shall determine) shall be allocated to the holder of Series 2019 Preferred Units to the extent that the redemption amount paid or payable with respect to the Series 2019 Preferred Units so redeemed exceeds the aggregate Capital Contribution per Series 2019 Preferred Unit allocable to the Series 2019 Preferred Units so redeemed and

Exhibit G

(b) deductions and losses (in such relative proportions as the General Partner in its discretion shall determine) shall be allocated to the holder of Series 2019 Preferred Units to the extent that the aggregate Capital Contribution per Series 2019 Preferred Unit allocable to the Series 2019 Preferred Units so redeemed exceeds the redemption amount paid or payable with respect to the Series 2019 Preferred Units so redeemed. The intent of this Section is that gain or loss shall be allocated so that the ending Capital Account of a holder of Series 2019 Preferred Units is equal to zero after a redemption.

9.    Restrictions on Ownership.

The Series 2019 Preferred Units are not transferrable and must be owned and held at all times solely by the General Partner.

10.    Adjustments for Stock Splits, etc.

If the number of outstanding shares of Series 2019 Preferred Stock is adjusted at any time or from time to time as a result of any stock dividend, or any reclassification, subdivision or combination of the outstanding shares of Series 2019 Preferred Stock into a greater or smaller number of shares of Series 2019 Preferred Stock, then a similar adjustment to the number of outstanding Series 2019 Preferred Units shall be made in order to preserve the economic equivalence of the Series 2019 Preferred Stock and the Series 2019 Preferred Units.

11.    General.

11.1    The ownership of Series 2019 Preferred Units may (but need not, in the sole and absolute discretion of the General Partner) be evidenced by one or more certificates. The General Partner shall amend Exhibit A to the Agreement from time to time to the extent necessary to reflect accurately the issuance of, and subsequent redemption, or any other event having an effect on the ownership of, the Series 2019 Preferred Units.

11.2    The rights of the General Partner, in its capacity as a holder of the Series 2019 Preferred Units, are in addition to and not in limitation of any other rights or authority of the General Partner in any other capacity under the Agreement or applicable law. In addition, nothing contained herein shall be deemed to limit or otherwise restrict the authority of the General Partner under the Agreement, other than in its capacity as a holder of the Series 2019 Preferred Units.

Exhibit G

EX-10.10

Exhibit 10.10

MEMBERSHIP INTEREST PURCHASE AND SALE AGREEMENT

[One Upland, Norwood, Massachusetts]

ARTICLE 1: PROPERTY/PURCHASE PRICE

1.1.    Certain Basic Terms.

(a) Buyer and Notice Address: CC One Upland, LLC Attn: Gregg Christensen c/o Cottonwood Communities 6340 South 3000 East, Suite 500 Salt Lake City, Utah 84121 Telephone: 801-278-0700 E-mail: gchristensen@cottonwoodres.com   (b) Seller and Notice Address:   KRE JAG ONE UPLAND VENTURE LLC, a Delaware limited liability company Attn: Paul Wasserman 600 Travis Street, Suite 7200 Houston, Texas 77002 Telephone: (713) 332-8322 E-mail: paul.wasserman@kkr.com   With a copy to   c/o Jefferson Apartment Group 1420 Spring Hill Rd., Suite 420 McLean, VA 22102 Attention: James Duncan Telephone: (703) 563.5200 E-mail: jduncan@jagllc.com   (c) Title Company:   Old Republic National Title Insurance 521 Fifth Avenue, 23^rd Floor New York, NY 10175 Attention: Michael Atkins Telephone: (646) 546.3138 E-mail: MAtkins@OldRepublicTitle.com With a copy to: Brownstein Hyatt Farber Schreck, LLP Attn: Amy Diaz 410 Seventeenth Street, Suite 2200 Denver, Colorado 80202-4438 Telephone: 303-223-1234 E-mail: adiaz@bhfs.com       With a copy to:   Gibson Dunn & Crutcher LLP Attn: Farshad Morè 333 S. Grand Avenue, 49^th Floor Los Angeles, California 90071 Telephone: (213) 229-7947 E-mail: fmore@gibsondunn.com

(e)	Date of this Agreement:	January 3, 2020
(f)	Purchase Price:	$104,000,000.00.
(g)	Initial Earnest Money:	$2,000,000, plus interest thereon.
(h)	Additional Earnest Money:	$1,000,000, plus interest thereon.
(i)	Extension Deposit:	$1,000,000, plus interest thereof (and, together with Initial Earnest Money and the Additional Earnest Money, the “Earnest Money”).
(j)	Due Diligence Period:	The period ending at 5:00 p.m. Pacific Time on January 24, 2020.

(k)	Closing Date:	As agreed between Seller and Buyer, but no later than February 14, 2020, subject to an extension to February 28, 2020 upon (i) written notice and (ii) payment of the Extension Deposit from Buyer to Seller delivered no later than February 12, 2020.
(l)	Broker:	Walker & Dunlop.

1.2.    Property. Seller is the sole member of KRE JAG One Upland Owner LLC, a Delaware limited liability company (“Property Owner”), and the Property Owner is the owner of the Property (as hereinafter defined). Subject to the terms of this Membership Interest Purchase and Sale Agreement (this “Agreement”), Seller agrees to sell to Buyer, and Buyer agrees to purchase from Seller, all of the limited liability company interests in Property Owner, together with all rights, duties and obligations appurtenant thereto, whether with respect to voting, control, capital accounts, rights to distributions from or in respect of Property Owner or in any way derived from the Property (as hereinafter defined) or ownership or operation thereof or otherwise (collectively, the “Interests”). As used herein, the “Property” shall mean:

(a)    The real property described in Exhibit A, together with the buildings and improvements thereon, inclusive of all right, title and interest, if any, of Property Owner in and to any (i) electrical distribution systems, HVAC systems, walkways, driveways, parking lots, plumbing, lighting, and mechanical equipment and fixtures installed thereon (the “Improvements”), (ii) all appurtenances of the above-described real property, including, without limitation, all development, density, air, and water rights attributable to or arising from the Improvements, (iii) all easements or rights-of-way relating thereto, and (iv) the land lying within any street or roadway adjoining the real property described above or any vacated or hereafter vacated street or alley adjoining said real property.

(b)    All of Property Owner’s right, title and interest, in and to all fixtures, furniture, equipment, and other tangible personal property, if any, owned by Seller (the “Personal Property”) presently located on such property, inclusive of all supplies thereon used in connection with the operation of the Property but excluding any items of personal property owned by tenant or any property manager.

(c)    All of Property Owner’s interest, as landlord, in the “Leases,” being all leases of the Improvements, and all amendments and modifications thereto, and including all leases which may be made by Property Owner after the Date of this Agreement and before Closing as permitted by this Agreement, together with all prepaid rent and unapplied security deposits, and all guaranties entered into in connection with such Leases, if any.

(d)    All of Property Owner’s right, title and interest, if any, in and to all of the following items, to the extent assignable and without warranty (the “Intangible Personal Property”): (i) licenses, and permits relating to the operation of the Property, (ii) the right to use the name of the Property in connection with the Property (provided, however, that Buyer shall only use the name “Jefferson” in connection with the property for a period of ninety (90) days following Closing), and any domain names, URLs and the content of any associated websites used solely in connection with the Property, but specifically excluding, in each case, the right to use any trademarks, logos, trade colors, service marks and trade names of Seller, and (ii) if still in effect, guaranties and warranties received by Seller from any contractor, manufacturer or other person in connection with the construction or operation of the Property. The provisions of this Paragraph 1.2(d)(ii) shall survive indefinitely any Closing or termination of this Agreement and shall not be merged into the Closing documents.

1.3.    Earnest Money. The Initial Earnest Money, in immediately available federal funds, evidencing Buyer’s good faith to perform Buyer’s obligations under this Agreement, shall be deposited by Buyer with the Title Company not later than 2 business days after the Date of this Agreement. In the event that Buyer fails to timely deposit the Initial Earnest Money with the Title Company, this Agreement shall be of no force and effect. Additionally, in the event Buyer does not elect (or is deemed to not have elected) to terminate this Agreement in accordance with Paragraph 2.5 hereof, then, no later than one (1) business day following the expiration of the Due Diligence Period, Buyer shall deposit the Additional Earnest Money Deposit with the Title Company. Buyer’s failure to timely deposit the Additional Earnest Money Deposit shall constitute a default by Buyer hereunder. The Earnest Money shall be applied to the Purchase Price at Closing. The Earnest Money shall be held and disbursed by the Title Company pursuant to Article 9 of this Agreement. Notwithstanding anything contained herein to the

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contrary, $100 of the Earnest Money is deemed to be independent contract consideration for Buyer’s exclusive right to inspect the Property and purchase the Interests under this Agreement and for Seller’s execution, delivery, and performance of this Agreement, which amount is fully-earned by Seller and non-refundable to Buyer in all events.

1.4.    Tax Treatment. The parties agree that the purchase and sale of the Interests pursuant to this Agreement shall be treated, for all U.S. federal and applicable state and local income tax purposes, as a purchase and sale of the Property (subject to the liabilities of the Property Owner).

ARTICLE 2: INSPECTIONS

2.1.    Property Information. Seller shall or shall cause Property Owner to make available to Buyer within five (5) business days after the Date of this Agreement, to the extent in Seller’s or Property Owner’s possession or control, copies of, or access to with the right to copy, the following (the “Property Information”):

(a)    the standard form of apartment lease used by Property Owner for the Property and the right to inspect and copy the existing Leases in the possession of the property manager for the Property;

(b)    a current rent roll of the Property, indicating rents collected, scheduled rents and concessions, delinquencies, and security deposits, pet and other deposits held (the “Rent Roll”);

(c)    operating statements for the two previous fiscal years, if available, and year to date (the “Operating Statements”);

(d)    a list of Personal Property, if any, and a list and copies of any service or maintenance agreements, if any, relating to the Property (the “Service Contracts”);

(e)    the current Property Owner’s Title Policy;

(f)    any existing land title survey of the Property;

(g)    any existing “as built” plans for the Improvements; and

(h)    those items listed on Exhibit B attached hereto, in each case, to the extent in Seller’s possession and control and which are not proprietary, confidential or privileged.

Except as otherwise expressly provided herein or in Paragraph 7.1(m), Seller makes no representations or warranties as to the accuracy or completeness of the Property Information.

2.2.    Confidentiality. The Property Information and all other information, other than matters of public record or matters generally known to the public, furnished to, or obtained through inspection of the Interests, Property Owner, or the Property by, Buyer, its affiliates, lenders, directors, members, employees, attorneys, accountants, and other professionals or agents, or any investors and potential investors in privately placed debt and equity offerings of securities of Buyer or any affiliate of Buyer under Section 4(a)(2) of the Securities Act of 1933, as amended, or Regulation D promulgated thereunder, relating to the Property, the Interests or the Property owner, will be treated by Buyer, its lenders, directors, members, employees, attorneys, accountants, and other professionals or agents, or any such investors and potential investors, as confidential, and will not be disclosed to anyone other than on a need-to-know basis and to Buyer’s consultants who agree to maintain the confidentiality of such information, and will be returned to Seller by Buyer if the Closing does not occur. The confidentiality provisions of this Paragraph 2.2 shall not apply to any disclosures made by Buyer as required by law, by court order, or in connection with any subpoena served upon Buyer; provided Buyer shall provide Seller with written notice before making any such disclosure.

2.3.    Inspections in General. During the Due Diligence Period, and provided this Agreement is not sooner terminated, through and including the Closing Date (provided, however, that Buyer shall have no right to terminate this Agreement pursuant to Paragraph 2.5 below as a result of due diligence inspections following the

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expiration of the Due Diligence Period), Buyer, its agents, and employees shall have the right to enter upon the Property for the purpose of making non-invasive inspections, which shall be deemed to include a Phase I environmental inspection and, subject to Seller’s prior written approval which shall not be unreasonably withheld, Buyer’s inspection of the EIFS building cladding system, in each case, at Buyer’s sole risk, cost and expense. Before any such entry, Buyer shall provide Seller with a certificate of insurance naming Seller and Property Owner as additional insureds and with an insurer and insurance limits and coverage reasonably satisfactory to Seller. All of such entries upon the Property shall be at reasonable times during normal business hours and after at least 24 hours prior written notice to Seller or Seller’s agent, and Seller or Seller’s agent shall have the right to accompany Buyer during any activities performed by Buyer on the Property; provided, however, that Buyer shall be entitled to perform such scheduled activities irrespective of whether Seller or Seller’s agent is unable to attend a previously scheduled activity for which the requisite notice to Seller was given in accordance with this Section 2.3. Buyer shall not contact any tenant of the Property, any employee of Seller or Property Owner, any governmental agency or instrumentality (other than customary inquiries to complete a Phase I environmental investigation and to confirm the zoning status and conformance of the Property with applicable laws) , or any other third person regarding the Interests, Property Owner or the Property without the prior written consent of Seller. Upon reasonable prior written notice and request from Buyer, Seller shall notify tenants of the Property and permit Buyer to view occupied units, subject to the rights of tenants under their leases and except to the extent specifically prohibited in such tenants’ leases. At Seller’s request, Buyer shall provide Seller, without representation or warranty, with a copy of the results of any third-party tests and inspections obtained by Buyer, excluding only market and economic feasibility studies. If any inspection or test physically damages the Property, Buyer will restore such physical damage caused to the Property to substantially the same condition as existed before such inspection or test. Buyer shall defend, indemnify and hold Property Owner, Seller, Seller’s partners, members, managers, directors, officers, tenants, agents, contractors and employees and the Property (collectively, “Indemnified Parties”) harmless from and against any and all losses, costs, actual damages (and not consequential, special, exemplary or punitive damages), claims, or liabilities, including but not limited to, mechanic’s and materialmen’s liens and Seller’s reasonable attorneys’ fees (collectively, “Claims”), to the extent such Claim (1) is suffered by, or asserted by any third party against an Indemnified Party and (2) arises out of or is in connection with Buyer’s inspection of the Property as allowed herein; provided, however, this indemnity shall not apply to any Claims to the extent arising out of the gross negligence or intentional misconduct of any Indemnified Parties or any pre-existing adverse condition or defect affecting the Property not caused by but merely revealed, and not exacerbated, by Buyer’s investigations. The provisions of this paragraph shall survive the Closing or the earlier termination of this Agreement.

2.4.    Environmental Inspections and Release. The inspections under Paragraph 2.3 may include a non-invasive Phase I environmental inspection of the Property, but no Phase II environmental inspection or other invasive inspection or sampling of soils, water, air or other materials, including without limitation construction materials, for analytical testing, either as part of the Phase I inspection or any other inspection, shall be performed without the prior written consent of Seller, which may be withheld in its sole and absolute discretion, and if consented to by Seller, the proposed scope of work and the party who will perform the work shall be subject to Seller’s review and approval. At Seller’s request, Buyer shall deliver to Seller, without representation or warranty, copies of any Phase II or other environmental report to which Seller consents as provided above. BUYER, FOR ITSELF AND ANY ENTITY AFFILIATED WITH BUYER, WAIVES AND RELEASES SELLER AND SELLER’S AFFILIATES (HEREAFTER DEFINED) FROM AND AGAINST ANY LIABILITY OR CLAIM RELATED TO THE PROPERTY ARISING UNDER THE COMPREHENSIVE ENVIRONMENTAL RESPONSE, COMPENSATION, AND LIABILITY ACT OF 1980, THE SUPERFUND AMENDMENTS AND REAUTHORIZATION ACT OF 1986, THE RESOURCE CONSERVATION AND RECOVERY ACT, AND THE TOXIC SUBSTANCE CONTROL ACT, ALL AS AMENDED, OR ANY OTHER CAUSE OF ACTION BASED ON ANY OTHER STATE, LOCAL, OR FEDERAL ENVIRONMENTAL LAW, RULE OR REGULATION. The provisions of this Paragraph 2.4 shall survive indefinitely any Closing or termination of this Agreement and shall not be merged into the Closing documents. “Seller’s Affiliates” means (a) any entity that directly or indirectly controls, is controlled by or is under common control with Seller, or (b) any entity at least a majority of whose economic interest is owned by Seller; and the term “control” means the power to direct the management of such entity through voting rights, ownership or contractual obligations. Notwithstanding the foregoing, the waivers and releases set forth in this Paragraph 2.4 shall not apply to (i) any breach of the representations and warranties of Seller contained in Paragraph 7.1(f), or (ii) any fraud perpetrated by Seller in connection with the transactions contemplated by this Agreement.

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2.5.    Termination During Due Diligence Period. If Buyer determines, in its sole and absolute discretion, before the expiration of the Due Diligence Period that the Interests and/or the Property is unacceptable for Buyer’s purposes, Buyer shall have the right to terminate this Agreement by giving to Seller written notice of termination before the expiration of the Due Diligence Period and the Earnest Money shall be immediately refunded to Buyer. In addition, upon such a termination, Buyer shall promptly return the Property Information to Seller, or certify to Seller that the Property Information has been destroyed. If Buyer does not give written notice of termination before the expiration of the Due Diligence Period, this Agreement shall continue in full force and effect, the Earnest Money shall become non-refundable to Buyer except as otherwise expressly provided herein, and Buyer shall have no further right to terminate this Agreement pursuant to this Paragraph 2.5.

2.6.    Buyer’s Reliance on its Investigations. TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW AND EXCEPT FOR SELLER’S REPRESENTATIONS AND WARRANTIES IN PARAGRAPHS 6.6 AND 7.1 AND ANY WARRANTIES (THE “SELLER’S WARRANTIES”) IN ANY DOCUMENT DELIVERED BY SELLER AT CLOSING PURSUANT TO THIS AGREEMENT (COLLECTIVELY, THE “CLOSING DOCUMENTS”), THIS SALE IS MADE AND WILL BE MADE WITHOUT REPRESENTATION, COVENANT, OR WARRANTY OF ANY KIND (WHETHER EXPRESS, IMPLIED, OR, TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, STATUTORY) BY SELLER. AS A MATERIAL PART OF THE CONSIDERATION FOR THIS AGREEMENT, BUYER AGREES TO ACCEPT THE INTERESTS AND THE PROPERTY ON AN “AS IS” AND “WHERE IS” BASIS, WITH ALL FAULTS, AND WITHOUT ANY REPRESENTATION OR WARRANTY, ALL OF WHICH SELLER HEREBY DISCLAIMS, EXCEPT FOR SELLER’S WARRANTIES. EXCEPT FOR SELLER’S WARRANTIES, NO WARRANTY OR REPRESENTATION IS MADE BY SELLER AS TO FITNESS FOR ANY PARTICULAR PURPOSE, MERCHANTABILITY, DESIGN, QUALITY, CONDITION, OPERATION OR INCOME, COMPLIANCE WITH DRAWINGS OR SPECIFICATIONS, ABSENCE OF DEFECTS, ABSENCE OF HAZARDOUS OR TOXIC SUBSTANCES, ABSENCE OF FAULTS, FLOODING, OR COMPLIANCE WITH LAWS AND REGULATIONS INCLUDING, WITHOUT LIMITATION, THOSE RELATING TO HEALTH, SAFETY, AND THE ENVIRONMENT. IN ENTERING INTO THIS AGREEMENT, BUYER IS NOT RELYING ON ANY STATEMENT, REPRESENTATION OR WARRANTY OTHER THAN SELLER’S WARRANTIES. BUYER ACKNOWLEDGES THAT BUYER HAS ENTERED INTO THIS AGREEMENT WITH THE INTENTION OF MAKING AND RELYING UPON ITS OWN INVESTIGATION OF THE PHYSICAL, ENVIRONMENTAL, ECONOMIC, USE, COMPLIANCE, AND LEGAL CONDITION OF THE INTERESTS AND THE PROPERTY AND THAT, OTHER THAN THE SELLER’S WARRANTIES, BUYER IS NOT NOW RELYING, AND WILL NOT LATER RELY, UPON ANY REPRESENTATIONS AND WARRANTIES MADE BY SELLER OR ANYONE ACTING OR CLAIMING TO ACT, BY, THROUGH OR UNDER OR ON SELLER’S BEHALF CONCERNING THE PROPERTY. NOTWITHSTANDING THE FOREGOING, THE FOREGOING RELEASE SHALL NOT APPLY TO (I) ANY FRAUD BY SELLER, OR (II) THIRD PARTY PERSONAL INJURY CLAIMS (E.G., SLIP AND FALL CASES) AGAINST BUYER CAUSED BY AN ACT OR OMISSION OF SELLER OCCURRING PRIOR TO THE CLOSING. The provisions of this Paragraph 2.6 shall survive indefinitely any Closing or termination of this Agreement and shall not be merged into the Closing documents.

ARTICLE 3: TITLE AND SURVEY REVIEW

3.1.    Delivery of Title Commitment and Survey. Seller shall cause to be delivered to Buyer (i) within three (3) days of the Date of this Agreement, a title commitment issued by the Title Company (the “Title Commitment”), covering the Property, together with copies of all documents referenced in the Title Commitment, and (ii) within 10 days of the Date of this Agreement, or as soon as available thereafter, an updated survey (the “Survey”).

3.2.    Title Review and Cure.

(a)    On or before the date that is seven (7) days after the delivery to Buyer of the Title Commitment and Survey (the “Objection Deadline”), Buyer shall give written notice (the “Objection Notice”) to Seller of any matter set forth in the Title Commitment and Survey to which Buyer objects (the “Objections”). If Buyer fails to tender an Objection Notice on or before the Objection Deadline, Buyer shall be deemed to have approved and

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irrevocably waived any objections to any matters covered by the Title Commitment and the Survey. On or before three (3) business days after receipt of the Objections (the “Response Deadline”), Seller may, in Seller’s sole discretion, give Buyer notice (the “Response Notice”) of those Objections that Seller is willing to cure or cause Property Owner to cure, if any. Seller shall have no obligation to cure or caused to be cured Objections except the Must-Cure Items (as hereinafter defined). If Seller fails to deliver a Response Notice by the Response Deadline, Seller shall be deemed to have elected not to cure or otherwise resolve any matter set forth in the Objection Notice. If Buyer is dissatisfied with the Response Notice or the lack of Response Notice, Buyer may, as its exclusive remedy, exercise its right to terminate this Agreement within three (3) business days following the Response Deadline. If Buyer provides such notice within such 3-business day period, this Agreement shall terminate and be of no further force and effect, and the Title Company shall return the Earnest Money to Buyer. If Buyer fails to timely exercise such right, Buyer shall be deemed to accept the Title Commitment and Survey with resolution, if any, of the Objections set forth in the Response Notice (or if no Response Notice is tendered, without any resolution of the Objections (and such Objections shall thereafter be deemed Permitted Exceptions) and without any reduction or abatement of the Purchase Price. Notwithstanding the foregoing, Seller shall be required to cure the Must-Cure Items and Buyer shall have such rights and remedies as provided in the case of a default by Seller hereunder with respect to any failure by Seller to cure a Must-Cure Item. In furtherance of the foregoing and notwithstanding anything to the contrary contained herein, at or prior to the Closing, Seller shall be obligated to remove, or cause Property Owner to remove, as the case may be, from title by payment of cash (or in the case of mechanic’s liens, posting of sufficient bonds): (a) all mortgages or deeds of trust securing indebtedness for money borrowed and which encumbers the Property, (b) all mechanic’s liens affecting the Property as a result of any act or omission, or at the express direction, of Seller or Property Owner (as distinguished from those arising, for instance, as a result of any act or omission of any tenant) which may be fully liquidated and discharged by payment of a fixed and ascertainable sum not to exceed $250,000, (c) all judgment liens first arising after the Date of this Agreement which may be fully liquidated and discharged by payment of a fixed and ascertainable sum not to exceed $250,000, and (d) any exceptions or encumbrances to title that are intentionally and knowingly created by Seller or Property Owner after the Date of this Agreement but prior to Closing without Buyer’s consent (collectively, the “Must-Cure Items”).

(b)    The term “Permitted Exceptions” shall mean: the specific exceptions (exceptions that are not part of the promulgated title insurance form) in the Title Commitment that the Title Company has not agreed to insure over or remove from the Title Commitment prior to Closing and that Seller is not required to remove as provided above; items shown on the Title Commitment and/or the Survey which have not been objected to under paragraph (a) above; the lien of real estate taxes not yet due and payable; and tenants in possession as tenants only under the Leases entered into as of the date hereof and hereinafter in accordance with this Agreement, with no options or rights to purchase all or any portion of the Property (including, without limitation, any rights of first opportunity, offer or refusal).

(c)    With respect to any material and adverse title exceptions or survey matters first arising after the effective date of the Title Commitment or the issuance of the Survey, as applicable, and prior to Closing (other than any of the Permitted Exceptions, to which Buyer shall have no right to object) (“New Title Exception”), Buyer shall have until the earlier of: (i) three (3) business days after Buyer’s knowledge of the New Title Objection (provided that Buyer shall request a date-down to the Title Commitment to be delivered to Buyer by the Title Company no later than five (5) business days prior to the expiration of the Diligence Period and Buyer shall be deemed to have knowledge of any New Title Exceptions contained therein); or (ii) the Closing Date to notify Seller in writing of Buyer’s objection thereto. If Buyer shall timely object to the New Title Exception, Seller shall have the right, but not the obligation, to cure such objection(s) in its sole and absolute discretion, subject to the provisions above in the case of Must-Cure Items. Within five (5) business days after receipt of Buyer’s notice of objection(s), with the Closing Date automatically extended, if necessary, to allow for such response period, Seller shall notify Buyer in writing whether Seller elects to attempt to cure such objection(s). Failure of Seller to give such notice within such five (5)-business day period shall be deemed an election by Seller not to cure such objection(s). If Seller elects or is deemed to have elected not to cure any objection(s) specified in Buyer’s notice, Buyer shall have the following options, to be given by written notice to Seller within two (2) business days after Seller’s election (or deemed election) not to cure such objection(s): (i) to accept a conveyance of the Property subject to the Permitted Exceptions, specifically including such New Title Exception (which such matter(s) shall thereafter be deemed to be a Permitted Encumbrances), without reduction of the Purchase Price; or (ii) to terminate this Agreement by sending written notice thereof to Seller and Escrow Agent, and upon delivery of such notice of termination, this Agreement shall terminate and the Deposit shall be returned to Buyer, and thereafter neither party hereto shall have any further rights, obligations or liabilities hereunder except for any obligation that expressly survives such termination of this Agreement.

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3.3.    Delivery of Title Policy at Closing. As a condition to Buyer’s obligation to close, the Title Company shall deliver to Property Owner at Closing either (at Buyer’s election in its sole discretion; provided that in no event shall Seller have or incur any additional cost, expense, liability or obligation to any party (including the Title Company) if Buyer elects the endorsement described in the immediately succeeding clause (i)), (i) an endorsement to Property Owner’s current Owner’s Title Policy, or (ii) a new Owner’s Policy of Title Insurance, in each case, issued as of the date and time of the effectiveness of the Assignment, in such amount as may be required by Buyer, insuring Property Owner as owner of good and indefeasible fee simple title to the Property, and subject only to the Permitted Exceptions (provided that if Buyer fails to provide Title Company with a Municipal Lien Certificate from the Town of Norwood in order to remove certain standard title policy exceptions, Buyer shall accept the Owner’s Policy of Title Insurance subject to such exception(s)) (such endorsement to Property Owner’s current Owner’s Title Policy or such new Owner’s Policy of Title Insurance, as applicable, being herein referred to as the “Title Policy”). Seller shall cause Property Owner execute at Closing an affidavit in such form reasonably acceptable to Seller as the Title Company shall require for the issuance of the Title Policy. The Title Policy may be delivered after Closing if that is customary in the locality, provided that Seller shall instruct the Title Company to do so as promptly as possible following the Closing. In addition, Buyer may request that (a) the Title Company issue, at Buyer’s sole cost and expense, a non-imputation endorsement (the “Non-Imputation Endorsement”) against the knowledge of Seller; and (b) Seller execute a non-imputation affidavit substantially in the form attached hereto as Exhibit E (the “Non-Imputation Affidavit”); it being agreed that each of the issuance of a Non-Imputation Endorsement and Seller’s execution of the Non-Imputation Affidavit shall be a condition precedent to Buyer’s obligation to consummate the Closing.

ARTICLE 4: OPERATIONS AND RISK OF LOSS

4.1.    Ongoing Operations. During the pendency of this Agreement, Seller shall carry on its business and activities relating to the Property Owner and the Property, including leasing of the Property, substantially in the same manner as it did before the Date of this Agreement and maintaining in full force and effect all insurance policies (or like policies) now in effect with respect to the Property. Seller shall not remove or permit to be removed from the Property any Personal Property, except as may be necessary for repairs or discarding worn out or useless items, provided that discarded items shall be replaced with new items of substantially equal quality and quantity and shall be free and clear of any lien or encumbrance.

4.2.    Performance under Leases and Service Contracts. During the pendency of this Agreement, Seller shall cause Property Owner to perform its material obligations under the Leases and Service Contracts and other agreements that may affect the Property. After the Date of this Agreement, Seller shall give prompt and reasonably detailed written notice to Buyer in the event it applies any tenant’s security deposit to the discharge of such tenant’s obligations.

4.3.    New Contracts. During the pendency of this Agreement, Seller will not and will not permit Property Owner enter into any contract that will be an obligation affecting the Interests, the Property Owner or the Property subsequent to the Closing, except (a) Leases and (b) contracts entered into in the ordinary course of business that are terminable without cause on 30-days’ notice and without penalty or cancellation fee, without the prior consent of Buyer, which shall not be unreasonably withheld or delayed.

4.4.    Termination of Service Contracts. During the Due Diligence Period, Buyer shall notify Seller which Service Contracts Buyer wishes to have Property Owner retain from and after Closing. Notwithstanding the foregoing, Property Owner shall retain Service Contracts that are not terminable on 30 days or less notice or that require the payment of a termination charge (unless Buyer agrees to pay such termination charge). Buyer shall pay any transfer or assignment charges due as a result of Buyer’s acquisition of the Interest hereunder, if any, under Service Contracts. Notice of termination for all Service Contracts not to be retained by Property Owner shall be given or caused to be given by Seller not later than the Closing Date and any charges due thereunder after the Closing Date and through the date of actual termination shall be included as a prorated expense. Notwithstanding the foregoing, Seller shall terminate any property management or leasing agreement affecting the Property, and Seller shall be solely responsible for paying, on or before the Closing Date, any fee, premium or penalty payable to any property or leasing agent in connection with such termination.

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4.5.    Damage or Condemnation. Risk of loss resulting from any condemnation or eminent domain proceeding which is commenced or has been threatened before the Closing, and risk of loss to the Property due to fire, flood or any other cause before the Closing, shall remain with Seller. If before the Closing the Property or any portion thereof shall be materially damaged, or if the Property or any material portion thereof shall be subjected to a bona fide threat of condemnation or shall become the subject of any proceedings, judicial, administrative or otherwise, with respect to the taking by eminent domain or condemnation, then Buyer may terminate this Agreement by written notice to Seller given within five (5) days after Buyer receives written notice from Seller of the damage or taking, in which event the Earnest Money shall be promptly returned to Buyer. If the Closing Date is within the aforesaid 5-day period, then Closing shall be extended to the next business day following the end of said five (5)-day period. If no such election is made, and in any event if the damage is not material, this Agreement shall remain in full force and effect and the purchase contemplated hereby, less any interest taken by eminent domain or condemnation, shall be effected with no further adjustment, and upon the Closing of this purchase, Seller shall assign, transfer and set over to Buyer all of the right, title and interest of Seller (if any) in and to any awards that have been or that may thereafter be made for such taking, and Seller shall assign, transfer and set over to Buyer any interest of Seller (if any) in any insurance proceeds that may thereafter be made for such damage or destruction giving Buyer a credit at Closing for any deductible under such policies, it being acknowledged and agreed that such separate assignments will not be required if Property Owner (as distinguished from Seller) shall have rights to such awards or proceeds. Any insurance proceeds received by Seller after the Closing and assigned to Buyer hereunder shall be promptly paid to Buyer upon receipt and until so paid, shall be held in trust by Seller for the benefit of Buyer. For the purposes of this paragraph, the phrases “material damage” and “materially damaged” means damage reasonably estimated by Seller in good faith (such estimate, the “Seller Assessment”) to have a cost exceeding three percent (3%) of the Purchase Price. If Buyer disagrees with the Seller Assessment and the parties are unable to agree on the cost of repair or restoration within five (5) business days after delivery of notice containing the Seller Assessment, the Closing Date shall automatically be extended until the earlier of (i) thirty (30) days after such damage or condemnation, and (ii) such time as the parties are able to agree on the cost of repair or restoration as follows:

(i) the matter will be submitted to an engineer designated by Seller and an engineer designated by Buyer, each licensed to practice in the Commonwealth of Massachusetts, and the engineers shall resolve the dispute.

(ii) If the engineers fail to resolve the dispute, such engineers shall designate a third engineer, who shall determine such resolution, which determination shall be binding on Seller and Buyer.

(iii) Each party hereto shall bear the costs and expenses of its own engineer. The cost of a third engineer, if any is appointed by the parties’ respective engineers, shall be borne one half (1/2) by the Sellers and one half (1/2) by the Buyer.

4.6.    Actions. Unless otherwise agreed to in writing by Buyer, Seller shall not knowingly and intentionally take any action or direct, require or advise any other person or entity to take any action that result in a breach of any of Seller’s representation or warranty provided under this Agreement or result in a default by Seller of its obligations under this Agreement. Seller shall not knowingly create or expressly permit to be created any encumbrances on the Property, other than those which may be fully satisfied from the proceeds of sale at the Closing.

ARTICLE 5: CLOSING

5.1.    Closing. The consummation of the transactions contemplated hereby (the “Closing”) shall occur on the Closing Date at the offices of the Title Company.

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5.2.    Conditions to the Parties’ Obligations to Close. The obligation of Seller, on the one hand, and Buyer, on the other hand, to consummate the transactions contemplated hereby is contingent upon the following:

(a)    The other party’s representations and warranties expressly set forth in this Agreement shall be true and correct in all material respects as of the Date of this Agreement and the Closing Date, except for those Seller’s Warranties (other than the Fundamental Representations) which may no longer be true and correct in all material respects as a result of a change in facts or circumstances which do not arise from Seller’s breach of default hereunder;

(b)    As of the Closing Date, the other party shall have performed its obligations expressly set forth in this Agreement and all deliveries to be made at Closing as expressly set forth in this Agreement have been tendered;

(c)    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 other party that would materially and adversely affect the other party’s ability to perform its obligations under this Agreement;

(d)    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 hereby; and

(e)    All Must Cure-Items shall be satisfied as provided in this Agreement, regardless of whether such issues were raised in Buyer’s objections hereunder.

So long as a party is not in default hereunder, if any condition to such party’s obligation to proceed with the Closing hereunder has not been satisfied as of the Closing Date, such party may, in its sole discretion, terminate this Agreement by delivering written notice to the other party on or before the Closing Date, in which event, unless the failure of such condition shall also constitute a breach of Buyer’s obligations hereunder (in which case the provisions of Paragraph 8.1 shall control) the Earnest Money shall be returned to Buyer, or elect to close, notwithstanding the non-satisfaction of such condition, in which event such party shall be deemed to have waived any such condition. If such party elects to close, notwithstanding the nonsatisfaction of such condition, there shall be no liability on the part of the other party for nonsatisfaction of such condition or for breaches of representations and warranties of which the party electing to close had knowledge as of the Closing.

5.3.    Seller’s Deliveries in Escrow. At least one (1) business day prior to the Closing Date, Seller shall deliver in escrow to the Title Company the following:

(a)    Assignment. An Assignment and Assumption of Interests in the form of Exhibit C attached hereto (the “Assignment”), executed by Seller, conveying the Interests free and clear of any lien or encumbrance.

(b)    Authority Documentation. Documentation to establish to Buyer’s reasonable satisfaction the due authority of Seller’s assignment of the Interests (including, but not limited to, the organizational documents of Seller, as amended from time to time, resolutions of Seller and incumbency certificates of Seller).

(c)    Property Owner Organizational Documents. Certified copies of the certificate of formation and operating agreement for Property Owner showing Seller as the sole and managing member thereof, together with good standing certificates for Property Owner from the States of Delaware and Massachusetts and resignations of any officers and managers for Property Owner, if any.

(d)    FIRPTA Affidavit. A certification from Seller and Property Owner that they are not a “foreign person” pursuant to Code Section 1445.

(e)    Intentionally Blank.

(f)    Additional Documents. Any additional documents that Title Company may reasonably require for the proper consummation of the transactions contemplated by this Agreement.

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(g)    Keys and Codes. Keys, combinations, and security codes for all locks and security devices on the Property, to the extent available.

(h)    Termination Notices. If not already provided prior to the Closing Date, Seller shall deliver evidence of termination for all Service Contracts not to be retained by Property Owner, if any, as determined by Buyer pursuant to the provisions of Section 4.4 of the Agreement (including termination of any property management or leasing agreements affecting the Property).

(i)    Tenant Notification Letter. A tenant notification letter, in a form reasonably provided by Buyer and duly executed by Seller, on behalf of Property Owner, notifying each tenant under a Lease that the Interests have been conveyed to Buyer and directing each Tenant to make all payments of rent and to send any notices or other correspondence regarding their respective leases to the persons and addresses to be determined by Buyer and specified in each such letter.

5.4.    Buyer’s Deliveries in Escrow. At least one business day prior to the Closing Date, Buyer shall deliver in escrow to the Title Company the following:

(a)    Purchase Price. The Purchase Price, less the Earnest Money that is applied to the Purchase Price, plus or minus applicable prorations, deposited by Buyer with the Title Company in immediate, same-day federal funds wired for credit into the Title Company’s escrow account at a bank satisfactory to Seller.

(b)    Assignment. The Assignment, executed by Buyer.

(c)    Additional Documents. Any additional documents that the Title Company may reasonably require for the proper consummation of the transactions contemplated by this Agreement (including, without limitation, a Municipal Lien Certificate from the Town of Norwood regarding the status of property taxes).

5.5.    Closing Statements. At the Closing, Seller and Buyer shall deposit with the Title Company executed closing statements consistent with this Agreement in the form required by the Title Company.

5.6.    Title Policy. The Title Policy shall be delivered at Closing as provided in Paragraph 3.3.

5.7.    Costs. Each party shall pay its portion of the following costs as indicated below:

(a) Survey – Buyer

(b) Title Policy:

(i) Basic premium – Buyer

(ii) Deletion of standard exceptions – Seller

(iii) Endorsements – Seller (any endorsements that Seller obtains to cure a title matter which Seller is obligated to cure pursuant to the terms of this Agreement to the extent such endorsement results in an additional premium payable to the Title Company); Buyer (any endorsements that Buyer elects to obtain)

(c) Recording charges

(i) Instruments to remove encumbrances that Seller is obligated to remove – Seller

(d) Appraisals, engineering studies, termite inspections, environmental inspections and other inspections and tests desired by Buyer – Buyer

(e) Any and all financing costs of Buyer or Buyer’s lender, including mortgage recording taxes – Buyer

(f) Transfer taxes, if any - Seller

(g) Other – The Title Company’s escrow fee shall be evenly divided between the parties. Each party shall pay its own attorneys’ fees. Buyer shall pay any escrow cancellation fee or other fees due upon a termination of this Agreement. All other costs shall be borne according to local custom.

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5.8.    Close of Escrow. The Title Company shall agree in writing with Seller and Buyer that (1) delivery of the Assignment to Buyer constitutes its 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 statements and (2) release of funds to Seller shall irrevocably commit it to issue the Title Policy in accordance with this Agreement. Upon satisfaction or completion of the foregoing conditions and deliveries, the parties shall direct the Title Company to immediately deliver the documents described above to the appropriate parties and make disbursements according to the closing statements executed by Seller and Buyer and in accordance with escrow instructions by each party consistent with this Agreement. Buyer acknowledges and agrees that, in connection with the Closing, Seller shall be entitled to direct the Title Company to use a portion of the Purchase Price to pay Property Owner’s existing loan secured by the Property a moment in time prior the Closing hereunder, provided that the Title Company shall have received from Seller irrevocable instructions to effectuate the Closing hereunder immediately following such pay-off.

ARTICLE 6: PRORATIONS

6.1.    Prorations. The day of Closing shall belong to Buyer (as the new sole member of Property Owner) and all prorations hereinafter provided to be made as of the Closing shall each be made as of the end of the day before the Closing Date. In each such proration set forth below, the portion thereof applicable to periods beginning as of Closing shall be credited or charged to Buyer and the portion thereof applicable to periods ending as of 11:59 P.M. on the day preceding Closing shall be credited or charged to Seller.

(a)    Taxes and Assessments. General real estate taxes and any other taxes or assessments imposed by governmental authority and any assessments imposed by private covenant constituting a lien or charge on the Property or the Property Owner for the then current calendar year or other current tax period (collectively, “Taxes”) not yet due and payable shall be prorated. If the Closing occurs prior to the receipt by Seller of the tax bill for the calendar year or other applicable tax period in which the Closing occurs, Buyer and Seller shall prorate Taxes for such calendar year or other applicable tax period based upon the most recent ascertainable combination of assessed values and tax rates. Seller shall be responsible for any Taxes relating to taxable periods, or portions thereof, ending on or before the Closing Date, and Buyer shall be responsible for any Taxes relating to taxable periods, or portions thereof, beginning on or after the Closing Date. Any refund or rebate of Taxes resulting from a tax protest, challenge or appeal (an “Appeal”) for a tax year ending prior to the Closing Date shall belong to Seller, whether received before or after Closing, and Seller shall have the sole authority to prosecute such Appeals. Any refund or rebate of Taxes, less a proportionate share of reasonable costs incurred in connection therewith, resulting from an Appeal for the tax year in which the Closing Date occurs shall be prorated between the parties in the same manner as prescribed above, whether received before or after Closing, and Seller shall have the sole authority to prosecute any such Appeal prior to the Closing Date and after the Closing Date, Buyer shall have the exclusive right to commence, continue and settle any Appeal to contest any Taxes for any taxable period which include the Closing Date.

(b)    Rents. All collected rent and other collected income (and any applicable state or local tax on rent) under Leases in effect on the Closing Date shall be prorated. Seller shall be charged with any rent and other income collected by Seller before Closing but applicable to any period of time after Closing. Uncollected rent and other income shall not be prorated. At Closing, Seller shall deliver to Buyer a schedule of delinquent rent. Until the date that is six (6) months after the Closing Date, Buyer shall include such delinquencies (or unpaid amounts) in its normal billing and shall pursue the collection thereof in good faith (but Buyer shall not be required to litigate or declare a default under any Lease or pursue any other action or remedy in connection with the recovery from tenants of such delinquencies or other unpaid amounts). To the extent Buyer receives payment of rent on or after the Closing Date, such payment shall be applied first toward the rent (or other tenant charge) for the month in which the Closing occurs, then to the rent owed to Buyer in connection with the applicable Lease, and then to any delinquent rents owed to Seller, with Seller’s share thereof being promptly delivered to Seller. Subject to the foregoing, Buyer may not waive any delinquent (or unpaid) rents or modify a Lease so as to reduce or otherwise affect amounts owed thereunder for any period in which Seller is entitled to receive a share of charges or amounts without first obtaining Seller’s written consent. In no event shall Seller be entitled to sue or otherwise seek to pursue any remedy for damages against any tenant under any non-terminated Lease owing delinquent rents and any other amounts to Seller (including, without limitation, seek to terminate any Lease or any tenant’s right to possession). Buyer shall reasonably cooperate with Seller, at no material out-of-pocket cost to Buyer, in any collection efforts hereunder. With respect to delinquent or other uncollected rents and any other amounts or other rights of any kind respecting tenants whose lease has been terminated or expired and who are no longer tenants of the Property as of the Closing Date, Seller shall retain all of the rights and obligations relating thereto.

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(c)    Utilities. Utilities, including water, sewer, electric, and gas, based upon the last reading of meters prior to the Closing shall be prorated. Seller shall endeavor to obtain, or cause to be obtained, meter readings on a date not more than two (2) business days before the Closing Date, and if such readings are obtained, there shall be no proration of such items. Seller shall cause Property Owner to pay at Closing the bills therefor for the period to the day preceding the Closing, and Buyer shall cause Property Owner to pay the bills therefor for the period subsequent thereto. If the utility company will not issue separate bills, Buyer will receive a credit against the Purchase Price for Seller’s portion and will pay the entire bill prior to delinquency after Closing. If Seller has paid any utilities no more than 30 days in advance in the ordinary course of business, then Buyer shall be charged its portion of such payment at Closing. Recoveries from the reimbursement of utility expenses collected by Buyer or Seller (or a third-party service provider) shall be prorated based upon, and shall relate back to, the months in which the billed expenses were incurred.

(d)    Fees and Charges under Service Contracts, Licenses and Permits. Fees and charges under the Service Contracts to be retained by Property Owner as provided herein, licenses and permits, on the basis of the periods to which such Service Contracts, licenses and permits relate shall be prorated.

6.2.    Final Adjustment After Closing. If final prorations cannot be made at Closing for any item being prorated under Paragraph 6.1, including Taxes, then Buyer and Seller agree to allocate such items on a fair and equitable basis as soon as invoices or bills are available, with final adjustment to be made for any such invoices or bills that are then available within ninety (90) days following Closing, but in all events within 10 months after the Closing, to the effect that income and expenses are received and paid by the parties on an accrual basis with respect to their period of ownership of the Interests. Payments in connection with the final adjustment shall be due within 30 days of written notice.

6.3.    Rental-Ready. Seller, at Seller’s sole expense, shall cause, or shall cause the Property Owner to cause, all unoccupied apartment units located in the Property vacant for more than five (5) days prior to Closing to be placed in a rental-ready condition on or before the Closing Date, in accordance with the Property Owner’s or Sellers’ past operating procedures; failing which, Buyer shall receive a credit against the Purchase Price at Closing in amount equal to $500.00 for each such unit which is not in rental-ready condition on the Closing Date. No earlier than five (5) business days prior to Closing and no later than two (2) business days prior to Closing, Seller and Buyer shall conduct a walk-through of the Property. At such time, the parties shall agree as to the status and number of units which are not rental-ready and shall determine the above credit based upon the number of units that are not rental-ready.

6.4.    Tenant Deposits. All refundable tenant security deposits in Property Owner’s possession, as reflected on a final Rent Roll delivered to Buyer (and interest thereon if required by law or contract to be earned thereon) and not theretofore applied to tenant obligations under the Leases, shall be credited to Buyer at Closing or placed in escrow if required by law. Buyer will indemnify, defend, and hold Seller harmless from and against all demands and claims made by tenants to the extent such claims relate to periods accruing after the Closing Date arising out of the transfer or disposition of any security deposits credited to Buyer and will reimburse Seller for any reasonable expenses (including all reasonable attorneys’ fees) incurred or that may be incurred by Seller as a result of any such claims or demands by tenants.

6.5.    Utility Deposits. Seller shall not be credited at Closing the amount of any deposits made with utility companies in respect of the Property, if any, unless such deposits (i) are not refunded to Seller in connection with the Closing, and (ii) continue to run to the benefit of Property Owner following the Closing Date.

6.6.    Sale Commissions. Seller and Buyer 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, if any Claim is made for broker’s or finder’s fees or commissions in connection with the negotiation, execution or consummation of this Agreement or the transactions contemplated hereby, each party shall defend, indemnify and hold harmless the other party from and against any such Claim based upon any statement, representation or agreement of the indemnifying party.

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ARTICLE 7: REPRESENTATIONS AND WARRANTIES

7.1.    Seller’s Representations and Warranties. As a material inducement to Buyer to execute this Agreement and consummate this transaction, Seller represents and warrants to Buyer that as of the date hereof and as of the Closing Date (unless otherwise expressly provided herein):

(a)    Organization and Authority. Seller is duly organized and validly existing as a Delaware limited liability company and is in good standing in the State of Delaware. Seller has the full corporate authority to enter into this Agreement and to consummate or cause to be consummated the transactions contemplated hereby. This Agreement has been, and all of the documents to be delivered by Seller at the Closing will be, authorized and properly executed and constitutes, or will constitute, as appropriate, the valid and binding obligation of Seller, enforceable in accordance with their terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws of general application or equitable principles affecting the rights and remedies of creditors. To Seller’s knowledge, no approval or consent of any governmental, administrative or regulatory body or any other person or entity (including, without limitation, any tenant under any Lease demising space at the Property) is required for the execution, delivery or performance by Seller of this Agreement, or any related documents or instruments, to which Seller is a party.

(b)    Conflicts and Pending Action. 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, administrative proceeding, suit, claim, litigation, investigation or other legal proceeding pending or, to Seller’s knowledge, threatened in writing against the Interests, the Property Owner or the Property, including condemnation proceedings, or against Seller which challenges or impairs Seller’s ability to execute or perform its obligations under this Agreement, and there are currently no remediation activities being conducted or in process on or in connection with the Property.

(c)    Rent Roll and Operating Statements. To Seller’s knowledge, the Rent Roll provided or to be provided to Buyer is or will be true, correct and complete in all material respects as of the date thereof. The Operating Statements were prepared by or for Seller or Property Owner in the ordinary course of its business and are the Operating Statements used and relied upon by Seller and Property Owner in connection with Property Owner’s operation of the Property. Other than as provided as part of the Property Information or set forth in the Rent Roll, to Seller’s knowledge, there are no leases, licenses or other rights of occupancy with respect to the Property to which Property Owner is a party. Seller has received no written notice from a tenant under its Lease of a material default by Property Owner under such tenant’s Lease.

(d)    Service Contracts. The list of Service Contracts delivered or to be delivered to Buyer pursuant to this Agreement is or will be true, correct, and complete in all material respects as of the date of its delivery. Neither Property Owner nor, to Seller’s knowledge, any other party is in material default under any Service Contract.

(e)    Books and Records. All books, records and other information prepared by Property Owner or its property manager and provided to Buyer by Seller were prepared by or for Seller or Property Owner in the ordinary course of its business and are the same books, records and other information used and relied upon by Seller and Property Owner in Property Owner’s operation of the Property.

(f)    Violations. To Seller’s knowledge, neither Seller nor Property Owner has received written notice from any governmental entity of any violation of any law, rule or regulation affecting the Property or its use including any environmental law or regulation, nor any written notice that the Property is in violation of any applicable building or zoning code or ordinance, except for any such matters which may have been previously cured by Seller or Property Owner, or from any insurance company, board of fire underwriters (or any organization exercising functions similar thereto) requiring or requesting the repair, alteration or correction of any existing condition on the Property. To Seller’s Knowledge, there are no pending changes to the zoning classification, or any plan, study or effort by any governmental authority or agency which in any way may or could materially impair the continued use and operation of the Property as currently used and operated. To Seller’s knowledge, all material

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required governmental permits, approvals, and certificates of occupancy have been obtained for the operation of the Property, the Property is operating according to its intended purpose, and the Property is properly zoned for its current use and it is not in material violation thereof.

(g)    FIRPTA. Seller is not a foreign person within the meaning of Section 1445 of the Code as hereinafter defined).

(h)    Entity Representations.

(i)    Seller is the sole owner of the Interests, and, at the Closing, Seller shall have transferred good title to such Interests to Buyer be free and clear of any liens, charges, claims, pledges, or encumbrances of any third party (collectively, “Liens”).

(ii)    Seller has or will deliver to Buyer a true and complete copy of the Limited Company Operating Agreement of the Property Owner in effect as of Closing Date (the “Property Owner Operating Agreement”).

(iii)    As of the Closing Date: (A) Property Owner will have filed, or caused to be filed, all tax returns required to be filed by it under applicable law; (B) all taxes required by applicable law to be paid by Property Owner will have been timely paid in full as and when due and payable; (C) there will be no liens with respect to unpaid taxes (other than for current taxes not yet delinquent) upon the Interests or the assets of the Property Owner; (D) all taxes required by applicable law to be withheld, collected or deposited by Property Owner will have been timely withheld, collected or deposited; and (E) the Property Owner has not (i) waived any statute of limitations in respect of taxes or (ii) agreed to any extension of time with respect to any tax assessment or deficiency, and the Property Owner has not received any request from a governmental authority to take any such action (which request is still pending). As of the date of this Agreement, Property Owner is not under audit, examination or proceeding by any governmental authority with respect to any taxes, and there are no claims or proceedings proposed or threatened in writing against Property Owner with respect to any taxes, and no assessment, deficiency or adjustment in respect of any taxes has been asserted by any governmental authority against the Property Owner that has not been finally resolved and satisfied. Property Owner is and at all times has been treated as a disregarded entity for federal and state income tax purposes, and no election has been made under the “check-the-box” regulations to treat the Property Owner as an association taxable as a corporation.

(iv)    Except for the matters set forth on Exhibit D hereto, the year-end operating statements, balance sheets and other financial statements heretofore provided or made available to Buyer by Seller are the year-end operating statements, balance sheets and other financial statements that Seller uses for its own account with respect to Property Owner for the 2019 calendar year and 2020 year to date (the “Financial Statements”). Except for the matters set forth on Exhibit D hereto, to Seller’s knowledge, the Financial Statements reflect all of Property Owner’s material liabilities (whether absolute, accrued, contingent or otherwise) as of the date thereof. As of the Closing Date, Property Owner has not incurred any new material liabilities (other than those liabilities incurred under Service Contracts in the ordinary course of business) since the date of the Financial Statements delivered to Buyer hereunder.

(v)    As of the Closing Date, Property Owner will be duly organized and validly existing and in good standing under the laws of the State of Delaware, and qualified to do business in the State of Massachusetts.

(vi)    Since the date of its formation, Property Owner has not had, and will not have had, any employees.

(vii)    Since the date of formation of Property Owner, Seller has not approved of, or consented to, or caused, the acquisition by Property Owner of any material assets other than the Property and property incidental to the ownership, use, maintenance and operation thereof; and to Seller’s knowledge, Property Owner has never engaged in any business or activities other than the acquisition, ownership, maintenance, financing and/or operation of the Property and activities incidental thereto.

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(viii)    Property Owner (a) is not party to any agreements with, and (b) does not have any liabilities to, in each case, any affiliate of Seller which will in each case remain in effect and be binding on Property Owner from and after the Closing.

(ix)    To Seller’s knowledge, the representations and warranties set forth on Exhibit F are true and correct in all material respects.

The representations and warranties of Seller contained in Paragraph 7.1(a), and 7.1(h)(i) shall be referred to herein as the “Fundamental Representations”. The representations and warranties of Seller contained in Paragraph 7.1(h)(ii), (iii), (iv), and (vii), shall be referred to herein as the “Entity Representations”.

(i)    Patriot Act. Seller is in compliance with all applicable anti-money laundering and anti-terrorist laws, regulations, rules, executive orders and government guidance, including the reporting, record keeping and compliance requirements of the Bank Secrecy Act (“BSA”), as amended by The International Money Laundering Abatement and Financial Anti-Terrorism Act of 2001, Title III of the USA PATRIOT Act (the “Patriot Act”), and other authorizing statutes, executive orders and regulations administered by OFAC, and related Securities and Exchange Commission, SRO or other agency rules and regulations, and has policies, procedures, internal controls and systems that are reasonably designed to ensure such compliance.

(j)    OFAC. Neither (i) Seller, any Affiliate of Seller nor any Person controlled by Seller; nor (ii) to the best of Seller’s knowledge, after making due inquiry, any Person who owns a controlling interest in or otherwise controls Seller; nor (iii) to the best of Seller’s knowledge, after making due inquiry, if Seller is a privately held entity, any Person otherwise having a direct or indirect beneficial interest (other than with respect to an interest in a publicly traded entity) in Seller; nor (iv) any Person for whom Seller is acting as agent or nominee in connection with this investment, is a country, territory, Person, organization, or entity named on an OFAC List, nor is a prohibited country, territory, Person, organization, or entity under any economic sanctions program administered or maintained by OFAC. For purposes of this Paragraph 7.1(i) and Paragraph 7.2(e), “Affiliate” means, with respect to a particular Person, any other Person who is Controlled by, under common Control with, or in Control of, such particular Person; “Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities or other beneficial interests, by contract or otherwise; and “Person” means any individual, company, trust or other legal entity of any kind whatsoever, or other organization, whether or not a legal entity.

(k)    Senior Foreign Political Figure. Unless disclosed in writing to Buyer on the date hereof, Seller is not a Senior Foreign Political Figure, or an Immediate Family Member or a Close Associate of a Senior Foreign Political Figure, Seller is not controlled by a Senior Foreign Political Figure, or an Immediate Family Member or a Close Associate of a Senior Foreign Political Figure, and, to the best of Seller’s knowledge, after making due inquiry, none of the direct or indirect owners of 10% or more of Seller (other than any owner(s) of any interest(s) in a publicly-traded entity) is a Senior Foreign Political Figure, or an Immediate Family Member or a Close Associate of a Senior Foreign Political Figure. For purposes of this Paragraph 7.1(k) and Paragraph 7.2(f), “Senior Foreign Political Figure” means a senior official in the executive, legislative, administrative, military or judicial branches of a foreign government (whether elected or not), a senior official of a major foreign political party, or a senior executive of a foreign government-owned corporation, and includes any corporation, business or other entity that has been formed by, or for the benefit of, a such senior official or executive; “Immediate Family Member” of a Senior Foreign Political Figure typically includes the Senior Foreign Political Figure’s parents, siblings, spouse, children and in-laws; and “Close Associate” of a Senior Foreign Political Figure means a person who is widely and publicly known to maintain an unusually close relationship with Senior Foreign Political Figure, and includes a person who is in a position to conduct substantial domestic and international financial transactions on behalf of the Senior Foreign Political Figure.

(l)    Seller has delivered true and correct copies of all reports and other documentation in Seller’s possession or control with respect to Property Owner’s obligations under Chapter 40B Affordable Housing, including, but not limited to, MassHousing Rental and Income Qualification Sheet and MassHousing Compliance Reports.

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(m)    Property Information. All items comprising the Property Information delivered by or on behalf of Seller to Buyer, or made available by Seller to Buyer for review, are to Seller’s knowledge, the complete and unaltered copies, in all material respects, of such items comprising the Property Information in Seller’s possession or control.

“Seller’s knowledge”, as used in this Agreement, means the current actual knowledge of Paul Wasserman and James Duncan, without any duty of inquiry or investigation, being the individuals most familiar with the matters contained in this Section 7.1.

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

(a)    Organization and Authority. Buyer has been duly organized and is validly existing as a limited liability company, in good standing in the State of Delaware and is qualified to do business in the state in which the Property is located. Buyer has the full right and authority and has obtained any and all consents required to enter into this Agreement and to consummate or cause to be consummated the transactions contemplated hereby. This Agreement has been, and all of the documents to be delivered by Buyer at the Closing will be, authorized and properly executed and constitutes, or will constitute, as appropriate, the valid and binding obligation of Buyer, enforceable in accordance with their terms.

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

(c)    Bankruptcy. Buyer has not (i) commenced a voluntary case, or had entered against it a petition, for relief under any federal bankruptcy act or any similar petition, order or decree under any federal or state law or statute relative to bankruptcy, insolvency or other relief for debtors, (ii) caused, suffered or consented to the appointment of a receiver, trustee, administrator, conservator, liquidator or similar official in any federal, state or foreign judicial or non-judicial proceeding, to hold, administer and/or liquidate all or substantially all of its property, or (iii) made an assignment for the benefit of creditors.

(d)    Patriot Act. Buyer is in compliance with all applicable anti-money laundering and anti-terrorist laws, regulations, rules, executive orders and government guidance, including the reporting, record keeping and compliance requirements of the BSA, as amended by The International Money Laundering Abatement and Financial Anti-Terrorism Act of 2001, Title III of the Patriot Act, and other authorizing statutes, executive orders and regulations administered by OFAC, and related Securities and Exchange Commission, SRO or other agency rules and regulations, and has policies, procedures, internal controls and systems that are reasonably designed to ensure such compliance.

(e)    OFAC. Neither (i) Buyer, any Affiliate of Buyer nor any Person controlled by Buyer; nor (ii) to the best of Buyer’s knowledge, after making due inquiry, any Person who owns a controlling interest in or otherwise controls Buyer; nor (iii) to the best of Buyer’s knowledge, after making due inquiry, if Buyer is a privately held entity, any Person otherwise having a direct or indirect beneficial interest (other than with respect to an interest in a publicly traded entity) in Buyer; nor (iv) any Person for whom Buyer is acting as agent or nominee in connection with this investment, is a country, territory, Person, organization, or entity named on an OFAC List, nor is a prohibited country, territory, Person, organization, or entity under any economic sanctions program administered or maintained by OFAC.

(f)    Senior Foreign Political Figure. Unless disclosed in writing to Seller on the date hereof, Buyer is not a Senior Foreign Political Figure, or an Immediate Family Member or a Close Associate of a Senior Foreign Political Figure, Buyer is not controlled by a Senior Foreign Political Figure, or an Immediate Family Member or a

16

Close Associate of a Senior Foreign Political Figure, and, to the best of Buyer’s knowledge, after making due inquiry, none of the direct or indirect owners of 10% or more of Buyer (other than any owner(s) of any interest(s) in a publicly-traded entity) is a Senior Foreign Political Figure, or an Immediate Family Member or a Close Associate of a Senior Foreign Political Figure.

“Buyer’s knowledge,” as used in this Agreement means the current actual knowledge of Gregg Christensen (“Buyer’s Knowledge Party”; each of Buyer’s Knowledge Party and Seller’s Knowledge Party is sometimes referred to herein as a “Knowledge Party”), without any duty of inquiry or investigation.

ARTICLE 8: DEFAULT AND DAMAGES

8.1.    Default by Buyer. If Buyer shall be in breach of any of its obligations hereunder and such breach shall remain uncured for a period of three (3) business days following written notice thereof by Seller (other than a breach under Paragraph 1.3 and Paragraph 5.4 hereof or otherwise a default to close hereunder on the Closing Date, with respect to which no such notice and cure period shall apply), Buyer agrees that Seller shall have the right to terminate this Agreement and to have the Title Company deliver the Earnest Money to Seller as liquidated damages to recompense Seller for time spent, labor and services performed, and the loss of its bargain. Buyer and Seller agree that it would be impracticable or extremely difficult to affix damages if Buyer so defaults and that the Earnest Money, together with the interest thereon, represents a reasonable estimate of Seller’s damages. Seller agrees to accept the Earnest Money as Seller’s total damages and relief hereunder if Buyer defaults in its obligation to close hereunder, Seller waiving all other rights and remedies, other than for its rights to indemnification pursuant to Paragraph 2.3.

8.2.    Default by Seller. If Seller shall be in breach of any of its obligations hereunder and such breach shall remain uncured for a period of three (3) business days following written notice thereof by Buyer (other than a breach under Paragraph 5.3 and Paragraph 6.6 hereof or otherwise a default to close hereunder on the Closing Date, with respect to which no such notice and cure period shall apply), Buyer’s sole and exclusive remedy shall be to elect one of the following: (a) to terminate this Agreement, in which event Buyer shall be entitled to the return by the Title Company to Buyer of the Earnest Money and reimbursement by Seller of its actual, documented out-of-pocket costs in connection with the transactions contemplated hereby (inclusive of any non-refundable deposits paid by Buyer to any third party for due diligence inspections or investigations and any non-refundable financing or rate lock deposit paid by Buyer to obtain financing for the acquisition of the Property), not to exceed, in any event, $125,000.00, (b) to bring a suit for specific performance provided that any suit for specific performance must be brought within 60 days of Seller’s default, to the extent permitted by law, Buyer waiving the right to bring suit at any later date or (c) if specific performance is not available or attainable solely as a result of Seller’s conveyance of the Interests or the Property or conveyance of a superior right to purchase the Interests or the Property to any person other than Buyer on or before the Closing Date, then Seller shall be liable to Buyer for actual damages (but not consequential , special, exemplary or punitive damages) caused by such action as Buyer’s sole and exclusive remedy. Buyer agrees not to file a lis pendens or other similar notice against the Interests, the Property, or any portion thereof, in any event, and the filing of this provision shall be deemed sufficient evidence in any court of competent jurisdiction to cause any such notice to be promptly and permanently removed of record from the Interests and/or Property. Buyer shall indemnify and hold Seller harmless from and against all costs, claims and expenses, including reasonable attorneys’ fees, incurred as a result of Buyer’s breach of this Paragraph 8.2.

ARTICLE 9: EARNEST MONEY PROVISIONS

9.1.    Investment and Use of Funds. The Title Company shall invest the Earnest Money in government insured interest-bearing accounts satisfactory to Buyer, shall not commingle the Earnest Money with any funds of the Title Company or others, and shall promptly provide Buyer and Seller with confirmation of the investments made.

9.2.    Contract Terminations. Upon a termination of this Agreement pursuant to the terms of the Agreement, either party to this Agreement (the “Terminating Party”) may give written notice to the Title Company 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 (5) business days in which to object in writing to the release of the Earnest

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Money to the Terminating Party. If the Non-Terminating Party provides such an objection, then the Title Company shall retain the Earnest Money until it receives written instructions executed by both Seller and Buyer 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 instructions, order, decree or judgment.

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

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

9.5.    Release of Earnest Money for Failure to Close. Notwithstanding anything contained herein to the contrary, in the event that Buyer fails to close under this Agreement on the Closing Date, and such failure to close is for any reason other than Seller’s default under this Agreement, then the Earnest Money shall be released to Seller on the business day immediately following the on which the Closing Date would have occurred.

ARTICLE 10: MISCELLANEOUS

10.1.    Parties Bound. Except for an assignment pursuant to Paragraph 10.17, neither party may assign this Agreement without the prior written consent of the other, and any such prohibited assignment shall be void. No assignment permitted under this Agreement shall relieve the assigning party of any liability hereunder, whether arising before or after the date of such assignment. 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.

At Closing, Buyer shall be permitted to assign this Agreement, the Earnest Money, and the rights of “Buyer” in connection therewith, to a Buyer’s Affiliate without the prior written consent of Seller, provided that Buyer delivers written notice of its intent to do so at least 5 business days prior to the Closing Date. “Buyer’s Affiliate” means (a) any entity that directly or indirectly controls, is controlled by or is under common control with Buyer, and (b) any entity at least a majority of whose economic interest is owned by Buyer; and the term “control” means the power to direct the management of such entity through voting rights, ownership or contractual obligations.

10.2.    Confidentiality. Neither Buyer nor Seller shall make any disclosure or public announcement of the existence of this Agreement, the identity of the parties hereto, the terms hereof or any other information related to this Agreement to outside brokers or third parties, before or for a period of two (2) years after the Closing, without the prior written consent of the other, and shall keep all of such information in strict confidence, except as to any investors and potential investors in privately placed debt and equity offerings of securities of Buyer or any affiliate of Buyer under Section 4(a)(2) of the Securities Act of 1933, as amended, or Regulation D promulgated thereunder, or as otherwise required by applicable law or regulation, or in connection with any filings or disclosures required by the Securities and Exchange Commission. Buyer shall not record this Agreement or any memorandum of this Agreement.

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10.3.    Headings. The article and paragraph headings of this Agreement are for convenience only and in no way limit or enlarge the scope or meaning of the language hereof.

10.4.    Exhibits and Schedules. All exhibits and schedules annexed hereto are a part of this Agreement for all purposes.

10.5.    Invalidity and Waiver. If any portion of this Agreement is held invalid or inoperative, then so far as is reasonable and possible the remainder of this Agreement shall be deemed valid and operative, and 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 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.

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

10.7.    Limitations. Unless otherwise expressly stated in this Agreement (including under this Paragraph 10.7), each of the covenants, obligations, representations, and agreements contained in this Agreement shall not survive the Closing and the execution and delivery of the Assignment required hereunder, or any earlier termination of this Agreement; provided, that (i) each of the representations and warranties contained in Paragraphs 7.1 and 7.2 shall survive the Closing for a period of nine (9) months immediately following the Closing Date, and (ii) the indemnification provisions provided in this Agreement in respect of either party hereto shall survive the termination of this Agreement or the Closing, whichever occurs, through the expiration of the applicable statute of repose. Notwithstanding the remaining provisions of this Paragraph 10.7, (x) the Fundamental Representations shall survive the Closing (but not the termination of this Agreement), and shall not be merged, for a period of five (5) years immediately following the Closing Date plus thirty (30) days (the “Fundamental Survival Period”), and (y) the Entity Representations shall survive the Closing (but not the termination of this Agreement), and shall not be merged, for a period of twenty four (24) months immediately following the Closing Date (the “Entity Survival Period”). As conditions precedent of the Buyer’s right to make any claim against Seller on account of any breach of any representations or warranties set forth in Paragraph 7.1, Buyer must (a) provide written notice of such breach of a representation or warranty (any notice to such effect must, in order to qualify as such for purposes of this Agreement, set forth specifically the representation or warranty allegedly breached and a reasonably detailed description of the alleged breach) within nine (9) months after Closing (or, with respect to breaches of Fundamental Representations or Entity Representations, within the Fundamental Survival Period or the Entity Survival Period, respectively) or Buyer shall be deemed to have waived any and all claims and rights to sue Seller for damages for such breach of representation and or warranty by Seller, and (b) upon timely written notice, Buyer must commence an action against Seller with respect to any such claims prior to the expiration of a 3-month period following delivery of such notice. To the fullest extent permitted by law, the foregoing shall constitute the express intent of the parties to shorten the period of limitations for bringing claims on account of Seller’s breach of its representations and warranties contained in Paragraph 7.1 if a longer period would otherwise be permitted by applicable law. Furthermore, no claim against Seller on account of any breach of any representations or warranties set forth in Paragraph 7.1 may be brought against Seller unless the amount of all such claims exceeds $75,000.00 in the aggregate, and Seller’s liability for all such claims, in the aggregate, shall be capped at $1,560,000.00 which sum shall be Seller’s sole liability; provided, that the foregoing deductible and cap shall not apply to any claim based on (i) a breach of a Fundamental Representation, (ii) a breach of an Entity Representation, or (iii) any intentional or willful misrepresentations, fraud or willful misconduct. Notwithstanding the foregoing, Seller’s liability for any breach of (a) the Fundamental Representations shall in no event exceed $104,000,000.00, and (b) the Entity Representations shall in no event exceed an amount equal to twenty percent (20%) of an amount equal to the portion of the Purchase Price actually received by Seller. In no event shall Seller be liable for consequential, punitive or exemplary damages. Buyer agrees that no present or future direct or indirect partner, member, manager, officer, director, shareholder, beneficial owner, affiliate, control person, agent or employee of Seller (the “Constituents”) shall have any personal liability, directly or indirectly, for any of Seller’s obligations hereunder, and recourse (whether by piercing the corporate veil or otherwise) shall not be had against any such Constituents, under or in connection with this Agreement, any documents executed and delivered by Seller at Closing or the transactions contemplated by this Agreement, and Buyer hereby waives and releases any and all such personal liability and recourse. Any judgment in any action or proceeding against any Seller shall be enforceable against such Seller only to the extent of such Seller’s interest in the portion of the Purchase Price actually received by such Seller. The provisions of this Paragraph 10.7 shall survive the Closing, and any earlier termination of this Agreement.

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10.8.    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, whether by decree or otherwise.

10.9.    Entirety and Amendments. This Agreement embodies the entire agreement between the parties and supersedes all prior agreements and understandings relating to the Property except for any confidentiality agreement binding on Buyer, which shall not be superseded by this Agreement. This Agreement may be amended or supplemented only by an instrument in writing executed by the party against whom enforcement is sought.

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

10.11.    Attorneys’ Fees. Should either party employ attorneys to enforce any of the provisions hereof, the party against whom any final judgment is entered agrees to pay the prevailing party all reasonable costs, charges, and expenses, including reasonable attorneys’ fees, expended or incurred in connection therewith. The term “prevailing party” is defined to mean the party who obtains a determination of wrongful conduct by the other party regardless of whether actual damages are awarded.

10.12.    Notices and Deliveries. All notices required or permitted hereunder shall be in writing and shall be served on the parties at the addresses set forth in Paragraph 1.1. Any such notices shall be either (a) sent by overnight delivery using a nationally recognized overnight courier, in which case notice shall be deemed delivered 1 business day after deposit with such courier, (b) sent by e-mail, with written confirmation by overnight or first class mail, in which case notice shall be deemed delivered upon the sending of such e-mail notice, or (c) sent by personal delivery, in which case notice shall be deemed delivered upon receipt. Any notice sent by e-mail or personal delivery and delivered after 5:00 p.m. local time where the Property is located shall be deemed received on the next business day. 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 Buyer shall be deemed given by Buyer; notices given by counsel to Seller shall be deemed given by Seller; and notices given to a party’s counsel shall be deemed given to the party.

10.13.    Construction. The parties acknowledge that the parties and their counsel have reviewed and revised this Agreement and 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 hereto.

10.14.    Business Days; Calculation of Time Periods. “Business Day” (or “business day”) means, as to any party, any day that is not a Saturday, Sunday or legal holiday for national banks in the location where the Property is located. If the last day of any time period hereunder, or the last day of performance of any obligation, or for the giving of notice, or for taking any other action falls on a day that is not a Business Day, then such last day shall be extended to the first day thereafter that is a Business Day, and any such day shall be deemed to end at 5:00 p.m. local time where the Property is located. Subject to the foregoing, in computing any time period described herein, 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.

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, such indemnitee will, if a claim in respect thereof is to be made against the indemnitor, deliver to the indemnitor written notice thereof and the indemnitor shall have the right to participate in such proceeding 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 thereof, with counsel mutually satisfactory to the parties; provided, however, that an 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 such indemnitee by the counsel retained by the indemnitor would be inappropriate due to actual or potential differing interests between such indemnitee and any

20

other party represented by such counsel in such proceeding. 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 relieve such indemnitor of any liability to the indemnitee under this indemnity only if and to the extent that such failure is prejudicial to its ability to defend such action, and the omission so to deliver written notice to the indemnitor will not relieve it of any other liability that it may have to any indemnitee. If an indemnitee settles a claim without the prior written consent of the indemnitor, then the indemnitor shall be released from liability with respect to such claim unless the indemnitor has unreasonably withheld such consent.

10.16.    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 and exchange by e-mail counterparts of the signature pages.

10.17.    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 the 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.

10.18.    Buyer has informed Seller that Buyer is required by law to complete with respect to certain matters relating to the Property an audit pursuant to Rule 3-14 of Securities and Exchange Commission Regulation S-X (the “Audit”), of the income statements of the Property for the last complete fiscal year immediately preceding the Closing Date and the stub period through the Closing Date (the “Audit Period”). In connection with the Audit, Seller shall, within 10 business days following the Effective Date, use commercially reasonable efforts to provide or otherwise make available to Buyer the documents which are necessary to conduct the Audit, to the extent in existence and in Seller’s possession. Following the Closing Date and for a period of up to one (1) year following the Closing Date, Seller shall reasonably cooperate (at no cost or liability of any kind to Seller) with Buyer’s auditor in the conduct of the Audit. Without limiting the foregoing, (a) Buyer or its designated independent or other auditor may audit the operating statements of the Property, at Buyer’s expense and, upon Buyer’s reasonable prior written request, Seller shall allow Buyer’s auditors reasonable access to such books and records maintained by Seller in respect to the Property and pertaining to the Audit Period as necessary to conduct the Audit; and (b) Seller shall use reasonable efforts to provide to Buyer such existing financial information as may be reasonably required by Buyer and required for Buyer’s auditors to conduct the Audit, provided, however, that the ongoing obligations of Seller shall be limited to providing such information or documentation as may be in the possession or control of Seller, the Sellers accountants or the applicable property or asset manager, at no cost or liability of any kind to any of such parties, and in the format the Seller has maintained such information.

10.19.    Waiver of Jury Trial. TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE PARTIES HEREBY WAIVE ANY RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

10.20.    Limitation of Liability. No partner, member, manager, officer, director, shareholder, beneficial owner, agent or employee of Seller or any affiliate thereof shall be personally liable for any obligation of Seller hereunder.

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10.21.    Indivisible Economic Package. Buyer has no right to purchase, and Seller has no obligation to sell, less than all of the Interests, it being the express agreement and understanding of Buyer and Seller that, as a material inducement to Seller and Buyer to enter into this Agreement, Buyer has agreed to purchase, and Seller has agreed to sell, all of the Interests, subject to and in accordance with the terms and conditions hereof. Any termination of this Agreement shall operate to terminate this Agreement as to all of the Interests simultaneously.

10.22.    Publicity. Seller, on the one hand, and Buyer, on the other hand, shall agree on the form and content of any press release or other public statement regarding the transactions contemplated hereby, if any, and thereafter shall consult with each other before issuing, provide each other the opportunity to review and comment upon, and negotiate in good faith to agree upon, any press release or other public statement with respect to any of the transactions contemplated hereby and shall not issue any such press release or make any such public statement prior to such consultation and prior to considering in good faith any such comments, except as may be required by applicable law, provided that neither party hereto may unreasonably withhold its consent to a proposed release or other public statement regarding the transactions contemplated hereby so long as the nature of such release or statement, as applicable, does not reveal non-public information that is not otherwise the subject of a disclosure made by a party hereto pursuant to applicable law.

[Signature Page Follows]

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SIGNATURE PAGE TO

MEMBERSHIP INTEREST PURCHASE AND SALE AGREEMENT

BY AND BETWEEN

KRE JAG ONE UPLAND VENTURE LLC

AND

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first set forth above.

KRE JAG ONE UPLAND VENTURE LLC, a Delaware limited liability company
By:	/s/ Michael Friedland
Name:	Michael Friedland
Title:	Vice President

“Seller”

[Signatures continue on the following page]

CC ONE UPLAND, LLC, a Delaware limited liability company
By:	COTTONWOOD COMMUNITIES O.P., LP, a Delaware limited partnership, its Sole Member
	By:	Cottonwood Communities, Inc., a Maryland corporation, its General Partner
		By:	/s/ Gregg Christensen
		Name:	Gregg Christensen
		Title:	Chief Legal Officer

“Buyer”

[Signature page to Membership Purchase and Sale Agreement]

Title Company has executed this Agreement in order to confirm that the Title Company has received and shall hold the Earnest Money and the interest earned thereon, in escrow, and shall disburse the Earnest Money, and the interest earned thereon, pursuant to the provisions of Article 9.

OLD REPUBLIC NATIONAL TITLE INSURANCE COMPANY
By:	/s/ Erin Parker
Name:	Erin Parker
Title:	First Vice President

“Title Company”

[Signatures end.]

[Signature page to Membership Purchase and Sale Agreement]

EXHIBIT A

LEGAL DESCRIPTION

Parcel One

That certain parcel of land in Norwood, Norfolk County, Massachusetts shown as Lot 4A on a plan

entitled “Campanelli Thorndike Norwood LLC, Lot 4A - Upland Woods Lower Road, Norwood, MA” prepared

by Kelly Engineering Group, Inc. dated October 10, 2014 recorded with the Norfolk County Registry

of Deeds in Plan Book 635, Page 22.

Parcel Two

Together with the benefits of the Access Easement for Use of Common Areas and other easements set

forth in Paragraph 8 of the Park Covenants and Maintenance Agreement by and between CFRI/CQ Norwood

Upland, L.L.C. and Upland Woods Management LLC dated February 10, 2005 recorded in Book 22094, Page

439 and filed as Document No. 1055346, as amended by First Amendment to Park Covenants and

Maintenance Agreement dated September 22, 2017 and recorded October 26, 2017 in Book 35548, Page

179.

Parcel Three

Together with the benefit of the Utility and Sewer Easement Agreement dated as of November 14, 2014

by and between CFRI/CQ Norwood Upland L.L.C. and Campanelli Thorndike Norwood LLC recorded in Book

32699 Page 206 as amended by Amendment to Utility and Sewer Easement Agreement between

Campanelli-Trigate Norwood Upland, L.L.C. and Campanelli Thorndike Norwood LLC dated as of June

29, 2017 recorded June 30, 2017 in Book 35240 Page 176.

A-1

EXHIBIT B

DUE DILIGENCE REPORTS

Reports	Preferred Format
Financials
Current Balance Sheet		Excel
Current Rent Roll with Lease Charges		Excel
Unit Directory		Excel
Market Rent Schedule by Unit Type		Excel
Two Years of Operating Statements		Excel
T-12 Operating Statement		Excel
Payroll Schedule
A/P Aging Schedule
A/R Aging Schedule including a Prepaid Report
Utility Bills (3-6 months) Including Phone, Internet and Cable
Rent Collections Ledger
Concession Schedule
Other Income Schedules (including parking, gardens, etc.)
Occupancy History (since leaseup)

Capex History (material capex projects during Seller’s ownership period only; provided, however, that Seller shall reasonably cooperate to provide additional information reasonably requested by Buyer)

Real Estate Tax Bills (2 years)

3rd Party Reports

Alta Survey

Termite Inspection Report

Title Policy Phase I

Unrecorded Title Docs

Elevator work order history and copy of the last years inspections

KKR EIFS Siding Letter 2019, 2018

B-1

Other Documents

Market Survey

List of 40B Units and 2019 Mass Housing Rent and Income Qualification Sheet

Copy of last Mass Housing Compliance Report

List of how 40b utilities are calculated and contract for Compliance Company Used

HOA Agreement or Contracts and Fee’s (2019 and 2020)

Leasing Status Report/Box Score Summary

Insurance Certificate

Insurance Claims (loss run)

Property Damage Incident Reports

Building Plans

Service Contracts

Licenses, Permits, Approvals

Vendor List with Addresses

List of Personal Property (Office, Amenities, Maintenance)

Site Plan/Survey

List of Pending Litigation

Residential Lease

Residential Security Deposits Report

Certificates of Occupancy

Current Pricing Sheet

Copies of existing Warranties

Existing Termite Bond

Floor Plans

Copies of any notices of violations of any federal, state, municipal or other health, fire, building, zoning, safety, environmental protection or other applicable codes, laws, rules, regulations or ordinances relating or applying to the Property within the past 2 years.

List of all litigation pending against the Property Manager, Property, Seller or as of the Effective Date.

B-2

Site Map

Amenity Rent Analysis

Lease Expiration Report Next 12 Months

Rentable Items Report

Demographic Report

Report Showing % of Students and Corporate Units

Maintenance Work Order Summary 2019

Certificate of Compliance on the Storm Water System

Current Internet Provider Current Telephone Provider, Make, and Model of all Phones

B-3

EXHIBIT C

FORM OF ASSIGNMENT AND ASSUMPTION OF INTERESTS

ASSIGNMENT AND ASSUMPTION OF INTERESTS

THIS ASSIGNMENT AND ASSUMPTION OF INTERESTS (this “Assignment”) is made and entered into as of                      by and between KRE JAG ONE UPLAND VENTURE LLC, a Delaware limited liability company (“Assignor”) to                      (“Assignee”) pursuant to that certain Membership Interest Purchase and Sale Agreement (the “Purchase Agreement”), dated as of                      between Assignor, and Assignee.

WHEREAS, Assignor is a member of, and owns 100% of the membership interests (the “Interests”) in, KRE JAG ONE UPLAND OWNER LLC, a Delaware limited liability company (“Property Owner”);

WHEREAS, Assignor desires to transfer 100% of its right, title and interest in and to the Interests to Assignee.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Assignor and Assignee agree as follows:

1.    Representation. Assignor hereby represents and warrants to Assignee that the recitals hereto are true, correct and complete.

2.    Assignment. Assignor hereby sells, conveys, assigns and transfers all of its right, title and interest in and to the Interests owned by it to the Assignee, to have and to hold such Interests unto Assignee, and the legal representatives, successors and assigns of Assignee, forever. Assignor hereby agrees to indemnify, defend and hold Assignee harmless against all Claims (as defined in the Purchase Agreement) arising out of, or in connection with, the Interests to the extent accruing during periods on or before the date hereof.

3.    Assumption. Assignee hereby accepts the assignment of the Interests and hereby assumes and agrees to perform and observe all liabilities and obligations of the Assignor in connection with the Interests arising or accruing from and after the date hereof. Assignee hereby agrees to indemnify, defend and hold Assignor harmless against all Claims arising out of, or in connection with, the Interests to the extent accruing during periods following the date hereof.

4.    Substitution as Member. Upon execution and delivery of this Assignment, Assignor shall have withdrawn as a member of Property Owner and Assignee shall thereafter be admitted as a substituted member of Property Owner.

5.    Governing Law. This Assignment shall be construed in accordance with, and be governed by, the internal laws of the State of Delaware.

6.    Counterparts. This Assignment may be executed in counterparts, including electronic counterparts, each of which will be deemed to be an original and all of which are one and the same assignment, but all of which shall together constitute one and the same instrument. Delivery of an executed counterpart of a signature page to this Assignment by electronic transmission shall be effective delivery of a manually executed counterpart of this Assignment.

7.    Further Assurances. Assignor agrees to cooperate at all times from and after the date hereof with respect to the supplying of any information reasonably requested by Assignee regarding any of the matters described in this Assignment, and Assignor agrees to execute such other instruments or documents as may be reasonably requested for the purpose of giving effect to, evidencing or giving notice of the transactions described herein.

C-1

8.    Conflicts. In the event of any conflict or inconsistency between the terms of the Purchase Agreement and the terms of this Assignment, the terms of the Purchase Agreement shall govern. For the avoidance of doubt, nothing contained in this Assignment shall in any way supersede, modify, replace, amend, rescind, waive, narrow or broaden any provision set forth in the Purchase Agreement or any of the rights, remedies or obligations arising therefrom.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

(Signatures appear on following page)

C-2

IN WITNESS WHEREOF, Assignor and Assignee caused this Assignment to be duly executed as of the date first above written.

ASSIGNOR:

KRE JAG ONE UPLAND VENTURE LLC,

a Delaware limited liability company

By:

Name:

Title:

ASSIGNEE:

[                                         ]

By:

Name:

Its:

C-3

EXHIBIT D

DISCLOSURES

None.

D-1

EXHIBIT E

FORM OF NON-IMPUTATION AFFIDAVIT

Old Republic National Title Insurance Co. Policy No.:                         

NON-IMPUTATION ENDORSEMENT INDEMNITY AGREEMENT

WHEREAS, Old Republic National Title Insurance Company, is about to issue its title insurance policy in connection with Commitment Number [                    ], hereinafter referred to as “Title Insurance Policy”, in respect of [                    ] (the “Property”);

WHEREAS, this Non-Imputation Endorsement Indemnity Agreement (this “Agreement”) is duly authorized by each of (i) [                    ], (ii) [                    ], and (iii) [                    ] (the “Members”).

WHEREAS, the Members are members of [                    ] (the “Company”), and the Company is the sole member of [                    ], a Delaware limited liability company (“Owner”).

WHEREAS, Old Republic National Title Insurance Company (“Underwriter”) has been requested to issue the Title Insurance Policy and, in connection therewith has been requested to include that certain Non-Imputation Endorsement, the form of which is attached hereto as Exhibit “A” (the “Endorsement”) as part of the Title Insurance Policy for the purpose of assuring Owner that, notwithstanding the terms of the Conditions and Stipulations or the Exclusions from Coverage in the Title Insurance Policy to the contrary, in the event of loss or damage insured against under the Title Insurance Policy, Underwriter will not deny liability under the Title Insurance Policy solely on the grounds that Owner had knowledge of any matter being imputed to it through the Members.

AND WHEREAS, Underwriter would refrain from issuing the Endorsements to the Title Insurance Policies in the absence of the representation, agreements and undertakings contained herein.

NOW THEREFORE, the undersigned, to his/their actual knowledge, after having made a reasonable inquiry of the (i) books and records and (ii) officers of Owner who, to his knowledge, have had substantial contact with any transaction or negotiation involving the Property, as material inducement to Underwriter to issue the Title Insurance Policy with the Endorsement, represent and warrant that neither the Members on behalf of Owner nor Owner (acting through any other person) have (or caused to be) executed or delivered any deed, land contract, lease (other than space leases with tenants shown on the rent roll described in the Title Affidavit or any documents associated with the garage lease), option to purchase, mortgage, deed of trust, confessed to any judgment, or executed any other agreement or other instrument to voluntarily create any lien upon, encumbrance upon, direct transfer of interest of the Property, or constructive trust in the Property or suffered or acquiesced in any of the foregoing not disclosed in title commitment [                    ] (the “Commitment”) or that certain Title-Affidavit, executed by Owner as of the date hereof (the “Title Affidavit”) (“Title Matters”) nor do they have any actual knowledge of such Title Matters.

FURTHER, the Members, jointly and severally, for themselves, their heirs, personal representatives and assigns do hereby covenant and agree with Underwriter:

1. To forever fully protect, defend and save Underwriter harmless from and against any and all actual, out-of-pocket loss, costs, damages (but excluding punitive, special, consequential and/or exemplary damages), reasonable attorney’s fees and out-of-pocket expenses of every kind and nature which it actually suffers, expends or incurs (“Losses”) under or by reason of, or in consequence of, the Endorsement to the Title Insurance Policy (i) on account of, or in

Non-Imputation Endorsement Indemnity Agreement

consequence of, or growing out of Title Matters created by the Members, or (ii) on account of the assertion or enforcement or attempted assertion or enforcement thereof or of any rights existing or hereafter arising of which may be claimed to exist under or by reason of, or in consequence of, or growing out of the Title Matters created by the Members (the matters referenced in clauses (i) and (ii) hereof, the “Indemnified Matters”); provided, however the term “Losses” shall not include any Losses that result from or arise in connection with the fraud, gross negligence, or willful misconduct of Chicago Title Insurance Company, its agents, affiliates, and/or co-insurers;

2. To provide for the defense, at their own expense, on behalf and for the protection of Underwriter and parties protected under the Endorsement (but without prejudice to the right of Underwriter to defend if it so elects) in all litigation consisting of actions or proceedings based on the Indemnified Matters which may be asserted or attempted to be asserted, established or enforced in, to, upon, against or in respect to the Property or any part thereof, or interest therein; and/or

3. To pay, discharge, satisfy or remove all or any of the Indemnified Matters, when called upon by Underwriter after thirty (30) days’ notice in writing and mailed to Members at the address set out below.

Nothing contained herein shall be construed so as to obligate the Underwriter to issue its Title Insurance Policy with the Endorsement in the form requested. However, should Underwriter issue the Title Insurance Policy, it will do so in reliance upon the undertakings of the Members and the issuance of the Title Insurance Policy with the Endorsement shall be the consideration for the above undertakings by the Members.

Underwriter shall have the right at any time hereafter, after written notice to the Members below and reasonable opportunity for the Members to cure, when it shall deem necessary, expedient, desirable or of interest to do so, in its/their sole discretion, to pay, discharge, satisfy or remove from the title to said Property all or any of the Indemnified Matters. The Members covenant and agree to pay Underwriter all amounts so expended for Losses incurred by the Underwriter. Notwithstanding anything to the contrary contained herein, none of the partners, shareholders, members, managers, officers, directors, trustees, agents or employees in or of any of the undersigned shall be personally liable in any manner or to any extent under or in connection with this Agreement whatsoever.

Notices to the Members shall be in writing addressed to them c/o [insert name and address] and sent by overnight courier service such as FedEx or UPS and deemed delivered and effective upon attempted delivery thereof (whether or not accepted).

Non-Imputation Endorsement Indemnity Agreement Order No. [                    ]

IN WITNESS WHEREOF, the Member(s) has/have executed this agreement this      day of             , 2020.

[NOTARY PAGE FOLLOWS]

Non-Imputation Endorsement Indemnity Agreement Order No. [                    ]

  A notary public or other officer completing this

  certificate verifies only the identity of the individual

  who signed the document to which this certificate is

  attached, and not the truthfulness, accuracy, or

  validity of that document.

STATE OF                                                              

COUNTY OF                                                                                       

SUBSCRIBED AND SWORN TO (or affirmed) before me on this

     day of             ,          by                      proved to me on the basis of

satisfactory evidence to be the person(s) who appeared before me.

Notary Signature:                                                                                  

EXHIBIT F

SPE PROVISIONS

Borrower Single Asset Status.

Until the indebtedness is fully paid, Borrower:

(1)    shall not acquire or lease any real property, personal property, or assets other than the Mortgaged Property;

(2)    shall not acquire, own, operate, or participate in any business other than the leasing, ownership, management, operation, and maintenance of the Mortgaged Property;

(3)    shall not commingle its assets or funds with those of any other Person, unless such assets or funds can easily be segregated and identified in the ordinary course of business from those of any other Person;

(4)    shall maintain its financial statements, accounting records, and other partnership, real estate investment trust, limited liability company, or corporate documents, as the case may be, separate from those of any other Person (unless Borrower’s assets are included in a consolidated financial statement prepared in accordance with generally accepted accounting principles);

(5)    shall have no material financial obligation under any indenture, mortgage, deed of trust, deed to secure debt, loan agreement, or other agreement or instrument to which Borrower is a party or by which Borrower is otherwise bound, or to which the Mortgaged Property is subject or by which it is otherwise encumbered, other than:

(A)    unsecured trade payables incurred in the ordinary course of the operation of the Mortgaged Property (exclusive of amounts (i) to be paid out of the Replacement Reserve Account or Repairs Escrow Account, or (ii) for rehabilitation, restoration, repairs, or replacements of the Mortgaged Property or otherwise approved by Lender) so long as such trade payables (1) are not evidenced by a promissory note, (2) are payable within sixty (60) days of the date incurred, and (3) as of any date, do not exceed, in the aggregate, two percent (2%) of the original principal balance of the Mortgaged Loan; provided, however, that otherwise compliant outstanding trade payables may exceed two percent (2%) up to an aggregate amount of four percent (4%) of the original principal balance of the Mortgage Loan for a period (beginning on or after the Effective Date) not to exceed ninety (90) consecutive days;

(B)    if the Security Instrument grants a lien on a leasehold estate, Borrower’s obligation as lessee under the ground lease creating such leasehold estate; and

(C)    obligations under the Loan Documents and obligations secured by the Mortgaged Property to the extent permitted by the Loan Documents;

(6)    shall not assume, guaranty, or pledge its assets to secure the liabilities or obligations of any other Person (except in connection with the Mortgage Loan or other mortgage loans that have been paid in full or collaterally assigned to Lender, including in connection with any Consolidation, Extension and Modification Agreement or similar instrument) or hold out its credit as being available to satisfy the obligations of any other Person;

(7)    shall not make loans or advances to any other Person; or

(8)    shall not enter into, or become a party to, any transaction with any Borrower Affiliate, except in the ordinary course of business and on terms which are no more favorable to any such Borrower Affiliate than would be obtained in a comparable arm’s-length transaction with an unrelated third party.

EX-10.11

Exhibit 10.11

FIRST AMENDMENT TO MEMBERSHIP INTEREST PURCHASE AND SALE AGREEMENT

This FIRST AMENDMENT TO MEMBERSHIP INTEREST PURCHASE AND SALE AGREEMENT (this “Amendment”) is made as of January 24, 2020 (the “Effective Date”) by and between KRE JAG ONE UPLAND VENTURE LLC, a Delaware limited liability company (“Seller”) and CC ONE UPLAND, LLC, a Delaware limited liability company (“Buyer”).

RECITALS:

A.    Seller and Buyer entered into that certain Membership Interest Purchase and Sale Agreement, dated as of January 3, 2020 (as the same may be further amended, supplemented and/or modified from time to time, the “Purchase Agreement”), with respect to the purchase and sale of one hundred percent (100%) of the Interests (as defined in the Purchase Agreement) of KRE JAG One Upland Owner LLC, a Delaware limited liability company, as more particularly described in the Purchase Agreement.

B.    The Due Diligence Period set forth in Purchase Agreement is set to expire at 5:00 p.m. Pacific time, on January 24, 2020.

C.    The parties hereto desire to extend the Due Diligence Period to January 30, 2020.

D.    Seller and Buyer desire to amend the Purchase Agreement as more particularly set forth in this Amendment.

AGREEMENT:

NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Seller and Buyer hereby agree as follows:

1.    Defined Terms. All terms capitalized but not otherwise defined herein shall have the meanings ascribed to them in the Purchase Agreement.

2.    Extension of Due Diligence Period. Pursuant to Section 1.1 of the Purchase Agreement, the Due Diligence Period is set to expire on 5:00 p.m (Pacific Time) on January 24, 2020. Notwithstanding the foregoing, the parties hereto agree to extend the Due Diligence Period until 5:00 p.m. (Pacific Time) on January 30, 2020.

3.    Title Objections Unaffected. Notwithstanding anything to the contrary contained herein, the parties hereto acknowledge and agree that Buyer is not and has not waived any of the Objections raised in Buyer’s Objection Notice, and that pursuant to Section 3.2(a) of the Purchase Agreement, the deadline for Seller to respond to the Buyer’s Objection Notice is January 27, 2020.

4.    Full Force and Effect. Except as expressly modified by this Amendment, the Purchase Agreement shall remain in full force and effect.

5.    Counterparts. This Amendment may be executed in two or more fully or partially executed counterparts (including PDF), each of which will be deemed an original binding the signer thereof against the other signing parties, but all counterparts together will constitute one and the same instrument.

[SIGNATURES APPEAR ON THE FOLLOWING PAGE]

2

IN WITNESS WHEREOF, each of the parties hereto has executed this Amendment as of the day and year first above written.

SELLER:	KRE JAG ONE UPLAND VENTURE LLC,
	a Delaware limited liability company
	By:	/s/ Michael Friedland
	Name:	Michael Friedland
	Title:	Vice President

[Signature Page – First Amendment to Membership Interest Purchase and Sale Agreement]

BUYER:	CC ONE UPLAND, LLC,
	a Delaware limited liability company
	By:	Cottonwood Communities O.P., LP,
		a Delaware limited liability company, its Sole Member
		By:	Cottonwood Communities, Inc.,
			a Maryland corporation, its General Partner
			By:	/s/ Gregg Christensen
			Name:	Gregg Christensen
			Title:	Chief Legal Officer

[Signature Page – First Amendment to Membership Interest Purchase and Sale Agreement]

EX-10.12

Exhibit 10.12

SECOND AMENDMENT TO MEMBERSHIP INTEREST PURCHASE AND SALE AGREEMENT

This SECOND AMENDMENT TO MEMBERSHIP INTEREST PURCHASE AND SALE AGREEMENT (this “Amendment”) is made as of January 30, 2020 (the “Effective Date”) by and between KRE JAG ONE UPLAND VENTURE LLC, a Delaware limited liability company (“Seller”) and CC ONE UPLAND, LLC, a Delaware limited liability company (“Buyer”).

RECITALS:

A.    Seller and Buyer entered into that certain Membership Interest Purchase and Sale Agreement, dated as of January 3, 2020, as amended by that certain First Amendment to Membership Interest Purchase and Sale Agreement (the “First Amendment”), dated as of January 24, 2020 (collectively, as the same may be further amended, supplemented and/or modified from time to time, the “Purchase Agreement”), with respect to the purchase and sale of one hundred percent (100%) of the Interests of KRE JAG One Upland Owner LLC, a Delaware limited liability company, as more particularly described in the Purchase Agreement.

B.    The Due Diligence Period set forth in Purchase Agreement is set to expire at 5:00 p.m. Pacific time, on January 30, 2020.

C.    The parties hereto desire to extend the Due Diligence Period solely with respect to the Extended Diligence Matters (as hereinafter defined) to February 7, 2020.

D.    Seller and Buyer desire to amend the Purchase Agreement as more particularly set forth in this Amendment.

AGREEMENT:

NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Seller and Buyer hereby agree as follows:

1.    Defined Terms. All terms capitalized but not otherwise defined herein shall have the meanings ascribed to them in the Purchase Agreement.

2.    Due Diligence Period. Pursuant to Section 2 of the First Amendment, the Due Diligence Period is set to expire on 5:00 p.m (Pacific Time) on January 30, 2020. Notwithstanding the foregoing, Buyer has requested an extension of the Due Diligence Period solely as it relates to Buyer’s further investigation of (i) the Town of Norwood’s proposed installation of a traffic stop light located at or near the Property, and the costs associated therewith, (ii) the requirements of, and Seller’s or Property Owner’s compliance with, that certain First Amended and Restated Chapter 40B Regulatory and Affordable Housing Agreement for Limited Dividend Organizations (the “Regulatory Agreement”), dated as of October 25, 2017, recorded in the Norfolk County Registry of Deeds on October 26, 2017, Book 35548, Page 201, as Instrument No. 102166, and (iii) Seller’s or Property Owner’s compliance

with that certain Order of Conditions of Massachusetts Department of Environmental Protection (collectively, the “Extended Diligence Matters”). Accordingly, the parties hereto agree that the Due Diligence Period under the Purchase Agreement shall be extended solely as it pertains to the Extended Diligence Matters until 5:00 p.m. (Pacific Time) on February 7, 2020, and that Buyer, by its execution hereof, hereby waives any and all rights to terminate the Purchase Agreement pursuant to Section 2.5 thereof as to all matters other than the Extended Diligence Matters.

3.    Contact with Governmental Authorities. In connection with Buyer’s diligence investigations pertaining to the Regulatory Agreement, Seller hereby consents to Buyer contacting the counterparty to the Regulatory Agreement; provided, however, that Buyer shall first provide at least 24 hours’ prior notice of any such planned communication to Seller (which notice may be provided by electronic mail) in order to afford Seller (or Seller’s agent) the opportunity to participate in any communications with such counterparty.

4.    Additional Buyer Closing Conditions. Notwithstanding anything to the contrary contained in the Purchase Agreement, in addition to such other conditions to Closing as more particularly described in the Purchase Agreement, it shall be a condition to Closing benefitting Buyer that on or prior to the Closing Date Seller shall have delivered a copy of the notice required pursuant to Section 10(b) of the Regulatory Agreement (the “Transfer Notice”), along with evidence of the date on which the same was delivered thereunder.

5.    Closing Date. Notwithstanding anything to the contrary contained in the Purchase Agreement, the Closing Date shall occur thirty one (31) days following the date in which Seller delivered the Transfer Notice or on such earlier date as Buyer and Seller may mutually agree; subject to an extension of fourteen (14) days upon (i) written notice and (ii) payment of the Extension Deposit from Buyer to Seller delivered no later than the two (2) business days prior to the then scheduled Closing Date.

6.    Full Force and Effect. Except as expressly modified by this Amendment, the Purchase Agreement shall remain in full force and effect.

7.    Counterparts. This Amendment may be executed in two or more fully or partially executed counterparts (including PDF), each of which will be deemed an original binding the signer thereof against the other signing parties, but all counterparts together will constitute one and the same instrument.

[SIGNATURES APPEAR ON THE FOLLOWING PAGE]

2

IN WITNESS WHEREOF, each of the parties hereto has executed this Amendment as of the day and year first above written.

SELLER:	KRE JAG ONE UPLAND VENTURE LLC,
	a Delaware limited liability company
	By:	/s/ Michael Friedland
	Name:	Michael Friedland
	Title:	Vice President

[Signature Page – Second Amendment to Membership Interest Purchase and Sale Agreement]

BUYER:	CC ONE UPLAND, LLC,
	a Delaware limited liability company
	By:	Cottonwood Communities O.P., LP,
		a Delaware limited liability company, its Sole Member
		By:	Cottonwood Communities, Inc.,
			a Maryland corporation, its General Partner
			By:	/s/ Enzio A. Cassinis
			Name:	Enzio A. Cassinis
			Title:	CEO and President

[Signature Page – Second Amendment to Membership Interest Purchase and Sale Agreement]

EX-10.13

Exhibit 10.13

THIRD AMENDMENT TO MEMBERSHIP INTEREST PURCHASE AND SALE AGREEMENT

This THIRD AMENDMENT TO MEMBERSHIP INTEREST PURCHASE AND SALE AGREEMENT (this “Amendment”) is made as of February 7, 2020 (the “Effective Date”) by and between KRE JAG ONE UPLAND VENTURE LLC, a Delaware limited liability company (“Seller”) and CC ONE UPLAND, LLC, a Delaware limited liability company (“Buyer”).

RECITALS:

A.    Seller and Buyer entered into that certain Membership Interest Purchase and Sale Agreement, dated as of January 3, 2020, as amended by that certain First Amendment to Membership Interest Purchase and Sale Agreement (the “First Amendment”), dated as of January 24, 2020, as further amended pursuant to that certain Second Amendment to Membership Interest Purchase and Sale Agreement, dated as of January 30, 2020 (the “Second Amendment”) (collectively, as the same may be further amended, supplemented and/or modified from time to time, the “Purchase Agreement”), with respect to the purchase and sale of one hundred percent (100%) of the Interests of KRE JAG One Upland Owner LLC, a Delaware limited liability company, as more particularly described in the Purchase Agreement.

B.    Pursuant to the Second Amendment, the parties hereto agreed to extend the Due Diligence Period under Purchase Agreement solely with regard to certain specified matters more particularly set forth therein, which extended the Due Diligence Period to 5:00 p.m. Pacific time, on February 7, 2020.

C.    The parties hereto desire to modify the matters which are the subject of Buyer’s continued due diligence investigations and further extend the Due Diligence Period solely with respect to the Modified Extended Diligence Matters (as hereinafter defined) to February 14, 2020.

D.    Seller and Buyer desire to amend the Purchase Agreement as more particularly set forth in this Amendment.

AGREEMENT:

NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Seller and Buyer hereby agree as follows:

1.    Defined Terms. All terms capitalized but not otherwise defined herein shall have the meanings ascribed to them in the Purchase Agreement.

2.    Due Diligence Period. Pursuant to Section 2 of the Second Amendment, the Due Diligence Period is set to expire on 5:00 p.m (Pacific Time) on February 7, 2020 with regard to the Extended Diligence Matters (as such term is defined in the Second Amendment). Notwithstanding the foregoing, Buyer has requested a further extension of the Due Diligence

Period solely as it relates to Buyer’s further investigation of (i) the Town of Norwood’s proposed installation of a traffic stop light located at or near the Property, and the costs associated therewith, and (ii) Seller’s or Property Owner’s compliance with that certain Order of Conditions of Massachusetts Department of Environmental Protection (collectively, the “Modified Extended Diligence Matters”). Accordingly, the parties hereto agree that the Due Diligence Period under the Purchase Agreement shall be extended solely as it pertains to the Modified Extended Diligence Matters until 5:00 p.m. (Pacific Time) on February 14, 2020, and that Buyer, by its execution hereof, hereby waives any and all rights to terminate the Purchase Agreement pursuant to Section 2.5 thereof as to all matters other than the Modified Extended Diligence Matters.

3.    Post-Closing 40B Obligations. Buyer and Seller agree to cooperate and work with the Massachusetts Housing Partership Fund Board (“MHP”) to determine the parties’ respective post-closing reporting obligations under that certain First Amended and Restated Chapter 40B Regulatory and Affordable Housing Agreement for Limited Dividend Organizations, dated October 25, 2017, and to subsequently amend the Purchase Agreement to include such post-closing obligations and time frames for compliance therewith.

4.    Full Force and Effect. Except as expressly modified by this Amendment, the Purchase Agreement shall remain in full force and effect.

5.    Counterparts. This Amendment may be executed in two or more fully or partially executed counterparts (including PDF), each of which will be deemed an original binding the signer thereof against the other signing parties, but all counterparts together will constitute one and the same instrument.

[SIGNATURES APPEAR ON THE FOLLOWING PAGE]

2

IN WITNESS WHEREOF, each of the parties hereto has executed this Amendment as of the day and year first above written.

SELLER:	KRE JAG ONE UPLAND VENTURE LLC,
	a Delaware limited liability company
	By:	/s/ Michael Friedland
	Name:	Michael Friedland
	Title:	Vice President

[Signature Page – Third Amendment to Membership Interest Purchase and Sale Agreement]

BUYER:	CC ONE UPLAND, LLC,
	a Delaware limited liability company
	By:	Cottonwood Communities O.P., LP,
		a Delaware limited liability company, its Sole Member
		By:	Cottonwood Communities, Inc.,
			a Maryland corporation, its General Partner
			By:	/s/ Enzio A. Cassinis
			Name:	Enzio A. Cassinis
			Title:	CEO and President

[Signature Page – Third Amendment to Membership Interest Purchase and Sale Agreement]

EX-10.14

Exhibit 10.14

FOURTH AMENDMENT TO MEMBERSHIP INTEREST PURCHASE AND SALE AGREEMENT

This FOURTH AMENDMENT TO MEMBERSHIP INTEREST PURCHASE AND SALE AGREEMENT (this “Amendment”) is made as of February 14, 2020 (the “Effective Date”) by and between KRE JAG ONE UPLAND VENTURE LLC, a Delaware limited liability company (“Seller”) and CC ONE UPLAND, LLC, a Delaware limited liability company (“Buyer”).

RECITALS:

A.    Seller and Buyer entered into that certain Membership Interest Purchase and Sale Agreement, dated as of January 3, 2020, as amended by that certain First Amendment to Membership Interest Purchase and Sale Agreement (the “First Amendment”), dated as of January 24, 2020, as further amended pursuant to that certain Second Amendment to Membership Interest Purchase and Sale Agreement, dated as of January 30, 2020 (the “Second Amendment”), and that certain Third Amendment to Membership Interest Purchase and Sale Agreement (the “Third Amendment”), dated as of February 7, 2020 (collectively, as the same may be further amended, supplemented and/or modified from time to time, the “Purchase Agreement”), with respect to the purchase and sale of one hundred percent (100%) of the Interests of KRE JAG One Upland Owner LLC, a Delaware limited liability company, as more particularly described in the Purchase Agreement.

B.    Pursuant to the Third Amendment, the parties hereto agreed to extend the Due Diligence Period under Purchase Agreement solely with regard to certain specified matters more particularly set forth therein, which extended the Due Diligence Period to 5:00 p.m. Pacific time, on February 14, 2020.

C.    The parties hereto desire to modify the matters which are the subject of Buyer’s continued due diligence investigations and further extend the Due Diligence Period solely with respect to the Modified Extended Diligence Matters (as such term is defined in the Third Amendment) to February 18, 2020.

D.    Seller and Buyer desire to amend the Purchase Agreement as more particularly set forth in this Amendment.

AGREEMENT:

NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Seller and Buyer hereby agree as follows:

1.    Defined Terms. All terms capitalized but not otherwise defined herein shall have the meanings ascribed to them in the Purchase Agreement.

2.    Due Diligence Period. Pursuant to Section 2 of the Third Amendment, the Due Diligence Period is set to expire on 5:00 p.m (Pacific Time) on February 14, 2020 with regard to

the Modified Extended Diligence Matters. Notwithstanding the foregoing, Buyer has requested a further extension of the Due Diligence Period solely as it relates to Buyer’s further investigation of Modified Extended Diligence Matters. Accordingly, the parties hereto agree that the Due Diligence Period under the Purchase Agreement shall be extended solely as it pertains to the Modified Extended Diligence Matters until 5:00 p.m. (Pacific Time) on February 18, 2020, and that Buyer, by its execution hereof, hereby waives any and all rights to terminate the Purchase Agreement pursuant to Section 2.5 thereof as to all matters other than the Modified Extended Diligence Matters.

3.    Full Force and Effect. Except as expressly modified by this Amendment, the Purchase Agreement shall remain in full force and effect.

4.    Counterparts. This Amendment may be executed in two or more fully or partially executed counterparts (including PDF), each of which will be deemed an original binding the signer thereof against the other signing parties, but all counterparts together will constitute one and the same instrument.

[SIGNATURES APPEAR ON THE FOLLOWING PAGE]

2

IN WITNESS WHEREOF, each of the parties hereto has executed this Amendment as of the day and year first above written.

SELLER:	KRE JAG ONE UPLAND VENTURE LLC,
	a Delaware limited liability company
	By:	/s/ Michael Friedland
	Name:	Michael Friedland
	Title:	Vice President

[Signature Page – Fourth Amendment to Membership Interest Purchase and Sale Agreement]

BUYER:	CC ONE UPLAND, LLC,
	a Delaware limited liability company
	By:	Cottonwood Communities O.P., LP,
		a Delaware limited liability company, its Sole Member
		By:	Cottonwood Communities, Inc.,
			a Maryland corporation, its General Partner
			By:	/s/ Enzio A. Cassinis
			Name:	Enzio A. Cassinis
			Title:	CEO and President

[Signature Page – Fourth Amendment to Membership Interest Purchase and Sale Agreement]

EX-10.15

Exhibit 10.15

FIFTH AMENDMENT TO MEMBERSHIP INTEREST PURCHASE AND SALE AGREEMENT

This FIFTH AMENDMENT TO MEMBERSHIP INTEREST PURCHASE AND SALE AGREEMENT (this “Amendment”) is made as of February 18, 2020 (the “Effective Date”) by and between KRE JAG ONE UPLAND VENTURE LLC, a Delaware limited liability company (“Seller”) and CC ONE UPLAND, LLC, a Delaware limited liability company (“Buyer”).

RECITALS:

A.    Seller and Buyer entered into that certain Membership Interest Purchase and Sale Agreement, dated as of January 3, 2020, as amended by that certain First Amendment to Membership Interest Purchase and Sale Agreement (the “First Amendment”), dated as of January 24, 2020, as further amended pursuant to that certain Second Amendment to Membership Interest Purchase and Sale Agreement, dated as of January 30, 2020 (the “Second Amendment”), as further amended pursuant to that certain Third Amendment to Membership Interest Purchase and Sale Agreement (the “Third Amendment”), dated as of February 7, 2020, and as further amended pursuant to that certain Fourth Amendment to Membership Interest Purchase and Sale Agreement (the “Fourth Amendment”), dated as of February 14, 2020 (collectively, as the same may be further amended, supplemented and/or modified from time to time, the “Purchase Agreement”), with respect to the purchase and sale of one hundred percent (100%) of the Interests of KRE JAG One Upland Owner LLC, a Delaware limited liability company, as more particularly described in the Purchase Agreement.

B.    Pursuant to the Fourth Amendment, the parties hereto agreed to extend the Due Diligence Period under Purchase Agreement solely with regard to certain specified matters more particularly set forth therein, which extended the Due Diligence Period to 5:00 p.m. Pacific time, on February 18, 2020.

C.    Seller and Buyer desire to amend the Purchase Agreement as more particularly set forth in this Amendment.

AGREEMENT:

NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Seller and Buyer hereby agree as follows:

1.    Defined Terms. All terms capitalized but not otherwise defined herein shall have the meanings ascribed to them in the Purchase Agreement.

2.    Purchase Price Adjustment. Section 1.1(f) of the Purchase Agreement is hereby deleted and replaced with the following:

(f)    Purchase Price: $103,600,000.00

3.    O&M Plan Completion. Notwithstanding anything to the contrary in the Purchase Agreement, on or prior to two (2) business days prior to Closing, Seller shall cause the Podgurski Corporation or another reasonably selected third party contractor, at Seller’s sole cost and expense, to complete the maintenance of certain items required by that certain O&M Plan and referred to in that certain Order of Conditions of the Massachusetts Department of Environmental Protection, recorded in the Norfolk County Registry of Deeds on July 15, 2014, Book 32699, Page 178 (collectively the “O&M Maintenance Obligations”), subject to any delays caused by fire, earthquake or other acts of God, inclement weather, strike, lockout, acts of public enemy, riot, insurrection, or governmental regulation of the sale or transportation of materials, supplies or labor (collectively, “Force Majeure”). No later than two (2) business days prior to Closing, Seller shall deliver to Buyer a list of those items that were completed pursuant to this paragraph.

4.    Annual Limited Dividend Financial Report. Notwithstanding anything to the contrary in the Purchase Agreement, pursuant to that certain that certain First Amended and Restated Chapter 40B Regulatory and Affordable Housing Agreement for Limited Dividend Organizations (the “Regulatory Agreement”), dated as of October 25, 2017, recorded in the Norfolk County Registry of Deeds on October 26, 2017, Book 35548, Page 201, as Instrument No. 102166, Seller shall use commercially reasonable efforts to deliver the Annual Limited Dividend Financial Report (as such term is defined in the Regulatory Agreement) for calendar year 2019 to the Massachusetts Housing Partnership Fund Board, a Massachusetts body politic and corporate (“MHP”), by the Closing Date. Notwithstanding the foregoing, (i) in the event Seller is unable to complete the Annual Limited Dividend Financial Report for calendar year 2019 by Closing, Seller shall deliver its Annual Limited Dividend Financial Report to MHP no later than the deadline set forth in the Regulatory Agreement, and (ii) Seller shall reasonably cooperate with Buyer to assist Buyer in completing the Annual Limited Dividend Financial Report for calendar year 2020, and (iii) Seller shall timely respond to any reasonable and customary requests from MHP for information. The provisions of this Section 4 shall survive Closing for a period of fifteen (15) months.

5.    Waiver of Diligence. By its execution of this Amendment, Buyer hereby waives all right to terminate the Purchase Agreement due to the Modified Extended Diligence Matters, and, from and after the date hereof, Buyer shall have no right to terminate pursuant to Section 2.5 of the Purchase Agreement.

6.    Park Covenants. To Seller’s knowledge, as of the date hereof, Property Owner is not in default of any its material obligations under that certain Park Covenants and Maintenance Agreement recorded February 22, 2005, in Book 22094, Page 439, as amended.

7.    Full Force and Effect. Except as expressly modified by this Amendment, the Purchase Agreement shall remain in full force and effect.

8.    Counterparts. This Amendment may be executed in two or more fully or partially executed counterparts (including PDF), each of which will be deemed an original binding the signer thereof against the other signing parties, but all counterparts together will constitute one and the same instrument.

[SIGNATURES APPEAR ON THE FOLLOWING PAGE]

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IN WITNESS WHEREOF, each of the parties hereto has executed this Amendment as of the day and year first above written.

SELLER:	KRE JAG ONE UPLAND VENTURE LLC,
	a Delaware limited liability company
	By:	/s/ Michael Friedland
	Name:	Michael Friedland
	Title:	Vice President

[Signature Page – Fifth Amendment to Membership Interest Purchase and Sale Agreement]

BUYER:	CC ONE UPLAND, LLC,
	a Delaware limited liability company
	By:	Cottonwood Communities O.P., LP,
		a Delaware limited liability company, its Sole Member
		By:	Cottonwood Communities, Inc.,
			a Maryland corporation, its General Partner
			By:	/s/ Enzio A. Cassinis
			Name:	Enzio A. Cassinis
			Title:	CEO and President

EX-10.16

Exhibit 10.16

EXECUTION VERSION

REVOLVING LOAN AND SECURITY AGREEMENT

DATED AS OF MARCH 19, 2020

BY AND AMONG

KRE JAG ONE UPLAND OWNER LLC,

AS BORROWER,

JPMORGAN CHASE BANK, N.A.,

AS ADMINISTRATIVE AGENT,

THE LENDERS REFERENCED HEREIN,

AND

JPMORGAN CHASE BANK, N.A.

AS SOLE BOOKRUNNER AND SOLE LEAD ARRANGER

JPMORGAN REAL ESTATE BANKING

TABLE OF CONTENTS

		Page
ARTICLE I DEFINED TERMS			1
1.01	Definitions		1
1.02	Terms Generally		21
1.03	Interest Rates; LIBOR Notification		22
ARTICLE II CONDITIONS TO DISBURSEMENT			22
2.01	Right to Advances		22
2.02	Conditions to Closing and Initial Advance		23
2.03	Conditions to Future Advances		25
ARTICLE III LOAN TERMS			25
3.01	The Loan and Advances		25
3.02	Requests for Advances		26
3.03	Funding of Advances		26
3.04	Interest Elections		26
3.05	Repayment of Loans; Evidence of Debt		27
3.06	Prepayment of Loans		28
3.07	Fees		28
3.08	Interest		29
3.09	Alternate Rate of Interest		29
3.10	Increased Costs		30
3.11	Break Funding Payments		31
3.12	Withholding of Taxes; Gross Up		31
3.13	Payments Generally; Pro Rata Treatment; Sharing of Setoffs		34
3.14	Mitigation Obligations; Replacement of Lenders		35
3.15	Extension Options		36
3.16	Defaulting Lenders		37
3.17	Increase in Commitments		39
3.18	Addition of Collateral Properties		40
ARTICLE IV GENERAL COVENANTS			41
4.01	Liens, Taxes, and Governmental Claims		41
4.02	Leases		41
4.03	Operations of Borrower		42
4.04	Appraisals		44
4.05	Operating and Reserve Accounts		44
4.06	Prohibited Distributions		44
4.07	Borrower’s Right to Contest Legal Requirements		44
4.08	Government Regulation		45
4.09	Financial Information and Other Deliveries		45
4.10	Hazardous Substances		46
4.11	ERISA		47
4.12	Compliance with Laws		47
4.13	Use of Proceeds		47
4.14	Massachusetts General Laws Chapter 40B		47
4.15	Debt Service Coverage Ratio		48
4.16	Post-Closing Covenant		48
ARTICLE V COLLATERAL ASSIGNMENT AND SECURITY AGREEMENT			48
5.01	Permits		48
5.02	Project Documents and Swap Agreements		48
5.03	Reassignment		50
5.04	Additional Instruments		50

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ARTICLE VI REPRESENTATIONS AND WARRANTIES		50
6.01	Representations and Warranties	50
6.02	Nature of Representations and Warranties	52
ARTICLE VII INSURANCE AND CONDEMNATION		52
7.01	Insurance and Casualty	52
7.02	Condemnation and Other Awards	56
ARTICLE VIII DEFAULTS		56
8.01	Defaults	56
ARTICLE IX ACCELERATION AND REMEDIES		59
9.01	Acceleration	59
9.02	Other Remedies	59
9.03	Curing of Defaults	60
ARTICLE X ADMINISTRATIVE AGENT		60
10.01	Authorization and Action	60
10.02	Administrative Agent’s Reliance, Indemnification, Etc.	62
10.03	Posting of Communications	63
10.04	Administrative Agent Individually	64
10.05	Successor Administrative Agent	64
10.06	Acknowledgements of Lenders	65
10.07	Collateral Matters	65
10.08	Credit Bidding	65
10.09	Lender Reply Period	66
10.10	Foreclosure	67
10.11	Certain ERISA Matters	67
10.12	Compliance with Flood Laws	68
ARTICLE XI MISCELLANEOUS		69
11.01	Notices	69
11.02	Waivers; Amendments	70
11.03	Expenses; Indemnity; Damage Waiver	71
11.04	Successors and Assigns	72
11.05	Survival	75
11.06	Counterparts; Integration; Effectiveness; Electronic Execution	76
11.07	Severability	76
11.08	Right of Setoff	76
11.09	Governing Law; Jurisdiction; Consent to Service of Process	77
11.10	WAIVER OF JURY TRIAL	77
11.11	Headings	78
11.12	Confidentiality	78
11.13	Interest Rate Limitation	78
11.14	USA Patriot Act	78
11.15	No Fiduciary Duty, Etc	79
11.16	Replacement Documentation	79
11.17	Swap Agreements	79
11.18	Statements	80
11.19	Acknowledgement and Consent to Bail-In of EEA Financial Institutions	80
11.20	Acknowledgement Regarding Any Supported QFCs	80

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EXHIBITS
Schedule 1.01(a)	—	Lenders
Schedule 1.01(b)	—	Borrower’s Organizational Chart
Schedule 3.18	—	Eligible Real Estate Qualification Documents
Exhibit A	—	Legal Description
Exhibit B	—	Promissory Note
Exhibit C	—	Intentionally Omitted
Exhibit D	—	Assignment and Assumption
Exhibit E-1	—	Form of Borrower Compliance Certificate
Exhibit E-2	—	Form of Guarantor Compliance Certificate
[Exhibit F-1	—	Form of U.S. Tax Compliance Certificate (For Foreign Lenders That Are Not Partnerships For U.S. Federal Income Tax Purposes)]
[Exhibit F-2	—	Form of U.S. Tax Compliance Certificate (For Foreign Participants That Are Not Partnerships For U.S. Federal Income Tax Purposes)]
[Exhibit F-3	—	Form of U.S. Tax Compliance Certificate (For Foreign Participants That Are Partnerships For U.S. Federal Income Tax Purposes)]
[Exhibit F-4	—	Form of U.S. Tax Compliance Certificate (For Foreign Lenders That Are Partnerships For U.S. Federal Income Tax Purposes)]

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REVOLVING LOAN AND SECURITY AGREEMENT

THIS REVOLVING LOAN AND SECURITY AGREEMENT (the “Agreement”) dated as of this 19th day of March, 2020, is by and among KRE JAG ONE UPLAND OWNER LLC, a Delaware limited liability company (“Borrower”), JPMORGAN CHASE BANK, N.A., a national banking association (“JPMorgan”) in its capacity as Administrative Agent (as hereinafter defined) and Lenders (as hereinafter defined).

RECITALS

WHEREAS, Borrower owns or is acquiring all of that certain real property located in the Town of Norwood, County of Norfolk and Commonwealth of Massachusetts more particularly described in Exhibit A attached hereto and incorporated herein by this reference (the “Property”) along with the improvements located thereon consisting of a 262 unit multifamily apartment complex (the “Improvements”); and

WHEREAS, Borrower has requested, and Lenders have agreed to provide, financing to Borrower on the terms and conditions set forth herein.

AGREEMENT

NOW, THEREFORE, for good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereto agree as follows:

ARTICLE I

DEFINED TERMS

1.01    Definitions.

The following terms shall have the following meanings:

“ABR” when used in reference to any Loan or Advance, refers to whether such Loan, or the Loans comprising such Advance, bear interest at a rate determined by reference to the Alternate Base Rate.

“Adjusted LIBO Rate” means, with respect to any Eurodollar Advance for the relevant Interest Period, or for any ABR Advance, an interest rate per annum (rounded upwards, if necessary, to the next 1/16 of 1%) equal to (a) the LIBO Rate for such Interest Period multiplied by (b) the Statutory Reserve Rate.

“Administrative Agent” means JPMorgan, in its capacity as administrative agent for Lenders hereunder.

“Administrative Questionnaire” means an Administrative Questionnaire in a form supplied by Administrative Agent.

“Advance” means a borrowing hereunder, (a) made by Lenders on the same Borrowing Date in the full amount of the Commitments on the Closing Date, and thereafter subject to and in accordance with this Agreement, or (b) converted or continued by Lenders on the same date of conversion or continuation, consisting, in either case, of the aggregate amount of the several Loans of the same Type and, in the case of Eurodollar Loans, for the same Interest Period.

“Affiliate” means, with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified.

“Agent Indemnitee” has the meaning assigned to it in Section 11.03(c).

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“Aggregate Commitment” means, as of any date of determination, the aggregate of the Commitments of all the Lenders; provided, however, with respect to any Advance requested by Borrower following the date of this Agreement, in no event shall the Lenders be obligated to make any Advance which, together with the unpaid principal amount all Loans existing as of the date of the requested Advance, would cause the unpaid principal amount of all Loans to exceed the least of (i) Sixty-Seven Million Six Hundred Thousand and 00/100 Dollars ($67,600,000), subject to the provisions of Section 3.17, (ii) 65.0% of the Appraised Value of the Property and, if applicable, other Eligible Real Estate that has become Collateral for the Loan, and (iii) the amount that would result in a Debt Service Coverage Ratio of less than 1.15 to 1.00 for the Property and, if applicable, other Eligible Real Estate that has become Collateral for the Loan. As of the date hereof, the Aggregate Commitment is Sixty-Seven Million Six Hundred Thousand and 00/100 Dollars ($67,600,000).

“Agreement” has the meaning assigned to it in the Preamble.

“Alternate Base Rate” means, for any day, a rate per annum equal to the greatest of (a) the Prime Rate in effect on such day, (b) the NYFRB Rate in effect on such day plus ¹⁄₂ of 1% and (c) the Adjusted LIBO Rate for a one month Interest Period on such day (or if such day is not a Business Day, the immediately preceding Business Day) plus 1%; provided that that for the purpose of this definition, the Adjusted LIBO Rate for any day shall be based on the LIBO Screen Rate (or if the LIBO Screen Rate is not available for such one month Interest Period, the Interpolated Rate) at approximately 11:00 a.m. London time on such day. Any change in the Alternate Base Rate due to a change in the Prime Rate, the NYFRB Rate or the Adjusted LIBO Rate shall be effective from and including the effective date of such change in the Prime Rate, the NYFRB Rate or the Adjusted LIBO Rate, respectively. If the Alternate Base Rate is being used as an alternate rate of interest pursuant to Section 3.09 (for the avoidance of doubt, only until any amendment has become effective pursuant to Section 3.09(b)), then the Alternate Base Rate shall be the greater of clauses (a) and (b) above and shall be determined without reference to clause (c) above. For the avoidance of doubt, if the Alternate Base Rate as determined pursuant to the foregoing would be less than 1.00%, such rate shall be deemed to be 1.00% for purposes of this Agreement.

“Annual Debt Service” means, as of any date of determination, annual debt service on a loan with a principal amount equal to the greater of (i) the outstanding principal balance of all unpaid Loans on such date of determination, or (ii) the outstanding principal balance of all unpaid Loans on such date of determination plus the amount of any Advance requested pursuant to Section 3.02, assuming (a) a fixed rate of interest per annum equal to the greatest of (i) the Eurodollar Rate as of such date of determination for a loan in such amount with an Interest Period equal to one (1) month, (ii) the annual yield to maturity as of such date of determination of a ten (10) year United States Treasury Note in the amount of such loan plus two percent (2.0%) per annum, or (iii) five and one quarter percent (5.25%) per annum, and (b) amortization of such loan in equal monthly payments of principal and interest over a period of thirty (30) years.

“Anti-Corruption Laws” means all laws, rules, and regulations of any jurisdiction applicable to Borrower or any of its Affiliates from time to time concerning or relating to bribery or corruption.

“Applicable Margin” means, for any day, (a) with respect to Eurodollar Advances, the rate per annum set forth below under the heading “Eurodollar Margin” opposite the applicable period then in effect, and (b) with respect to Floating Rate Advances, the rate per annum set forth below under the heading “Floating Rate Margin” opposite the applicable period then in effect; provided, however, that no reduction in the Applicable Margin shall occur after the occurrence and during the continuance of a Default:

Period	Eurodollar Margin			Floating Rate Margin
During a High Debt Yield Margin Period		1.50	%		.50	%
During a Low Debt Yield Margin Period		1.75	%		.75	%

“Applicable Parties” has the meaning assigned to it in Section 10.03(c).

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“Applicable Percentage” means, with respect to any Lender, the percentage of the Aggregate Commitment represented by such Lender’s Commitment; provided that in the case of Section 11.11 when a Defaulting Lender shall exist, “Applicable Percentage” means the percentage of the Aggregate Commitment (disregarding any Defaulting Lender’s Commitment) represented by such Lender’s Commitment. If the Commitments have terminated or expired, the Applicable Percentages shall be determined based upon the Commitments most recently in effect, giving effect to any assignments and to any Lender’s status as a Defaulting Lender at the time of determination.

“Appraisal” means a written statement setting forth an opinion of the market value of the Mortgaged Property that (i) has been independently and impartially prepared by a qualified appraiser directly engaged by Administrative Agent, (ii) complies with all applicable federal and state laws and regulations dealing with appraisals or valuations of real property, and (iii) has been reviewed as to form and content and approved by Administrative Agent, in its reasonable discretion.

“Appraised Value” means the “as-is” dollar value of the Project, as determined by the Required Lenders based upon their review of an Appraisal.

“Approved Electronic Platform” has the meaning assigned to it in Section 10.03(a).

“Approved Fund” has the meaning assigned to such term in Section 11.04.

“Arranger” means JPMorgan Chase Bank, N.A. in its capacity as a sole bookrunner and sole lead arranger hereunder.

“Assignment and Assumption” means an assignment and assumption entered into by a Lender and an assignee (with the consent of any party whose consent is required by Section 11.04 hereof), and accepted by Administrative Agent, in the form of Exhibit D attached hereto or any other form (including electronic records generated by the use of an electronic platform) approved by Administrative Agent.

“Assignment of Rents” means the Assignment of Leases and Rents of even date herewith executed by Borrower in favor of Administrative Agent, for the benefit of Lenders, as amended from time to time.

“Availability Period” means the period from and including the Closing Date to but excluding the earlier of the Maturity Date and the date of termination of the Commitments.

“Available Commitment” means an amount equal to the excess, if any, of (a) the Aggregate Commitment then in effect minus (b) the outstanding principal amount of the Loans then outstanding.

“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.

“Bail-In Legislation” means, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.

“Bankruptcy Event” means, with respect to any Person, such Person becomes the subject of a voluntary or involuntary bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee, administrator, custodian, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business, appointed for it, or, in the good faith determination of Administrative Agent, has taken any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any such proceeding or appointment , or has had any order for relief in such proceeding entered in respect thereof provided that a Bankruptcy Event shall not result solely by virtue of any ownership interest, or the acquisition of any ownership interest, in such Person by a Governmental Authority or instrumentality thereof, unless such ownership interest results in or provides such Person with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permits such Person (or such Governmental Authority or instrumentality), to reject, repudiate, disavow or disaffirm any contracts or agreements made by such Person.

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“Benchmark Replacement” means the sum of: (a) the alternate benchmark rate (which may be a SOFR-Based Rate) that has been selected by Administrative Agent and Borrower giving due consideration to (i) any selection or recommendation of a replacement rate or the mechanism for determining such a rate by the Relevant Governmental Body and/or (ii) any evolving or then-prevailing market convention for determining a rate of interest as a replacement to the LIBO Rate for U.S. dollar-denominated syndicated credit facilities and (b) the Benchmark Replacement Adjustment; provided that, if the Benchmark Replacement as so determined would be less than zero, the Benchmark Replacement will be deemed to be zero for the purposes of this Agreement; provided further that any such Benchmark Replacement shall be administratively feasible as determined by Administrative Agent in its sole discretion.

“Benchmark Replacement Adjustment” means the spread adjustment, or method for calculating or determining such spread adjustment, (which may be a positive or negative value or zero) that has been selected by Administrative Agent and Borrower giving due consideration to (i) any selection or recommendation of a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of the LIBO Rate with the applicable Unadjusted Benchmark Replacement by the Relevant Governmental Body and/or (ii) any evolving or then-prevailing market convention for determining a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of the LIBO Rate with the applicable Unadjusted Benchmark Replacement for U.S. dollar-denominated syndicated credit facilities at such time (for the avoidance of doubt, such Benchmark Replacement Adjustment shall not be in the form of a reduction to the Eurodollar Rate).

“Benchmark Replacement Conforming Changes” means, with respect to any Benchmark Replacement, any technical, administrative or operational changes (including changes to the definition of “Alternate Base Rate,” the definition of “Interest Period,” timing and frequency of determining rates and making payments of interest and other administrative matters) that Administrative Agent decides in its reasonable discretion may be appropriate to reflect the adoption and implementation of such Benchmark Replacement and to permit the administration thereof by Administrative Agent in a manner substantially consistent with market practice (or, if Administrative Agent decides that adoption of any portion of such market practice is not administratively feasible or if Administrative Agent determines that no market practice for the administration of the Benchmark Replacement exists, in such other manner of administration as Administrative Agent decides is reasonably necessary in connection with the administration of this Agreement).

“Benchmark Replacement Date” means the earlier to occur of the following events with respect to the LIBO Rate:

(1)     in the case of clause (1) or (2) of the definition of “Benchmark Transition Event,” the later of (a) the date of the public statement or publication of information referenced therein and (b) the date on which the administrator of the LIBO Screen Rate permanently or indefinitely ceases to provide the LIBO Screen Rate; or

(2)    in the case of clause (3) of the definition of “Benchmark Transition Event,” the date of the public statement or publication of information referenced therein.

“Benchmark Transition Event” means the occurrence of one or more of the following events with respect to the LIBO Rate, for which Administrative Agent shall endeavor to provide reasonable prior written notice to Borrower:

(1)    a public statement or publication of information by or on behalf of the administrator of the LIBO Screen Rate announcing that such administrator has ceased or will cease to provide the LIBO Screen Rate, permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide the LIBO Screen Rate;

(2)    a public statement or publication of information by the regulatory supervisor for the administrator of the LIBO Screen Rate, the U.S. Federal Reserve System, an insolvency official with jurisdiction over the administrator for the LIBO Screen Rate, a resolution authority with jurisdiction over the administrator for the LIBO Screen Rate or a court or an entity with similar insolvency or resolution authority over the administrator for the LIBO Screen Rate, in each case which states that the administrator of the LIBO Screen Rate has ceased or will cease to provide the LIBO Screen Rate permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide the LIBO Screen Rate; and/or

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(3)    a public statement or publication of information by the regulatory supervisor for the administrator of the LIBO Screen Rate announcing that the LIBO Screen Rate is no longer representative.

“Benchmark Transition Start Date” means (a) in the case of a Benchmark Transition Event, the earlier of (i) the applicable Benchmark Replacement Date and (ii) if such Benchmark Transition Event is a public statement or publication of information of a prospective event, the 90th day prior to the expected date of such event as of such public statement or publication of information (or if the expected date of such prospective event is fewer than 90 days after such statement or publication, the date of such statement or publication) and (b) in the case of an Early Opt-in Election, the date specified by Administrative Agent or the Required Lenders, as applicable, by notice to Borrower, Administrative Agent (in the case of such notice by the Required Lenders) and the Lenders.

“Benchmark Unavailability Period” means, if a Benchmark Transition Event and its related Benchmark Replacement Date have occurred with respect to the LIBO Rate and solely to the extent that the LIBO Rate has not been replaced with a Benchmark Replacement, the period (x) beginning at the time that such Benchmark Replacement Date has occurred if, at such time, no Benchmark Replacement has replaced the LIBO Rate for all purposes hereunder in accordance with Section 3.09 and (y) ending at the time that a Benchmark Replacement has replaced the LIBO Rate for all purposes hereunder pursuant to Section 3.09.

“Beneficial Ownership Certification” means a certification regarding beneficial ownership or control as required by the Beneficial Ownership Regulation.

“Beneficial Ownership Regulation” means 31 C.F.R. § 1010.230.

“Benefit Plan” means any of (a) an “employee benefit plan” (as defined in Section 3(3) of ERISA) that is subject to Title I of ERISA, (b) a “plan” as defined in Section 4975 of the Code to which Section 4975 of the Code applies, and (c) any Person whose assets include (for purposes of the Plan Asset Regulations or otherwise for purposes of Title I of ERISA or Section 4975 of the Code) the assets of any such “employee benefit plan” or “plan”.

“BHC Act Affiliate” of a party means an “affiliate” (as such term is defined under, and interpreted in accordance with, 12 U.S.C. 1841(k)) of such party.

“Borrower” has the meaning set forth in the preamble.

“Borrower’s Equity Requirement” means the amount described in Section 2.02(b)(xxi).

“Borrower Financing Statement” means the UCC financing statement covering the security interests in personal property granted by Borrower to Administrative Agent for the benefit of Lenders in the Loan Documents for filing with the Secretary of State of the State of Delaware.

“Borrowing Date” means a date on which an Advance is made hereunder.

“Borrowing Request” means a request by Borrower for an Advance in accordance with Section 3.02 hereof.

“Business Day” means any day that is not a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by law to remain closed; provided that, when used in connection with a Eurodollar Advance, the term “Business Day” shall also exclude any day on which banks are not open for general business in London.

“Capital Lease Obligations” of any Person means the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases or financing leases on a balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP.

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“Certification of Non-Foreign Status” means an affidavit, signed under penalty of perjury by an authorized officer of Borrower, stating (a) that Borrower is not a “foreign corporation,” “foreign partnership,” “foreign trust,” or “foreign estate,” as those terms are defined in the Code and the regulations promulgated thereunder, (b) Borrower’s U.S. employer identification number, and (c) the address of Borrower’s principal place of business. Such affidavit shall be consistent with the requirements of the regulations promulgated under Section 1445 of the Code, and shall otherwise be in form and substance acceptable to Administrative Agent.

“Change in Law” means the occurrence, after the date of this Agreement of: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation, implementation or application thereof by any Governmental Authority or (c) compliance by any Lender (or, for purposes of Section 3.10(b), by any lending office of such Lender or by such Lender’s holding company, if any) with any request, guideline or directive (whether or not having the force of law) of any Governmental Authority made or issued after the date of this Agreement; provided that notwithstanding anything herein to the contrary, (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder, issued in connection therewith or in implementation thereof, and (ii) all requests, rules, guidelines and directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall, in each case, be deemed to be a “Change in Law”, regardless of the date enacted, adopted, issued or implemented.

“Charges” has the meaning set forth in Section 11.13 hereof.

“Closing Date” is the date of the disbursement of the Loan.

“Co-Borrower” means a Potential Co-Borrower that becomes a borrower, together with Borrower, under this Agreement.

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

“Collateral” means all of the property, rights and interests of Borrower and, if applicable a Co-Borrower, which are subject to the security interests, security title, liens and mortgages created by the Loan Documents, including, without limitation, the Mortgaged Property.

“Commitment” means, for each Lender, the amount set forth on Schedule 1.01(a) opposite such Lender’s name, or in the Assignment and Assumption or other documentation or record (as such term is defined in Section 9-102(a)(70) of the New York Uniform Commercial Code) as provided in Section 11.04(b)(ii)(C), pursuant to which such Lender shall have assumed its Commitment, as applicable, and giving effect to any reduction or increase in such amount from time to time pursuant to assignments by or to such Lender pursuant to Section 11.04. The initial aggregate amount of the Lenders’ Commitments is Sixty-Seven Million Six Hundred Thousand and 00/100 Dollars ($67,600,000).

“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. §1 et seq.), as amended from time to time, and any successor statute.

“Communications” has the meaning assigned to it in Section 10.03.

“Compounded SOFR” means the compounded average of SOFRs for the applicable Corresponding Tenor, with the rate, or methodology for this rate, and conventions for this rate (which may include compounding in arrears with a lookback and/or suspension period as a mechanism to determine the interest amount payable prior to the end of each Interest Period) being established by Administrative Agent in accordance with:

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(1)    the rate, or methodology for this rate, and conventions for this rate selected or recommended by the Relevant Governmental Body for determining compounded SOFR; provided that:

(2)    if, and to the extent that, Administrative Agent determines that Compounded SOFR cannot be determined in accordance with clause (1) above, then the rate, or methodology for this rate, and conventions for this rate that Administrative Agent determines in its reasonable discretion are substantially consistent with any evolving or then-prevailing market convention for determining compounded SOFR for U.S. dollar-denominated syndicated credit facilities at such time;

provided, further, that if Administrative Agent decides that any such rate, methodology or convention determined in accordance with clause (1) or clause (2) is not administratively feasible for Administrative Agent, then Compounded SOFR will be deemed unable to be determined for purposes of the definition of “Benchmark Replacement.”

“Comprehensive Permit Documents” means collectively: (i) the Comprehensive Permit issued by the Norwood Zoning Board of Appeal pursuant to Massachusetts General Laws, Chapter 40B, Section 20 and 23, as amended, pursuant to that certain Norwood Zoning Board of Appeal Decision and recorded with the Norfolk County Registry of Deeds on December 10, 2013 in Book 31953, Page 301; (ii) the Regulatory and Affordable Housing Agreement between Campanelli Thorndike Norwood LLC and Massachusetts Housing Partnership Fund Board dated August 18, 2014 and recorded with the Norfolk County Registry of Deeds on August 28, 2014 in Book 32509, Page 420, as amended by First Amended and Restated Chapter 40B Regulatory and Affordable Housing Agreement for Limited Dividend Organizations, dated October 25, 2017 and recorded October 26, 2017 in Book 35548, Page 201; (iii) the Town Regulatory Agreement between The Town of Norwood and Campanelli Thorndike Norwood LLC dated as of August 7, 2014 and recorded with the Norfolk County Registry of Deeds on August 28, 2014 in Book 32509, Page 442; and (iv) all other documents in connection with the foregoing to which Borrower is a party or bound.

“Connection Income Taxes” means Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profits Taxes.

“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. “Controlling” and “Controlled” have meanings correlative thereto.

“Corresponding Tenor” with respect to a Benchmark Replacement means a tenor (including overnight) having approximately the same length (disregarding business day adjustment) as the applicable tenor for the applicable Interest Period with respect to the LIBO Rate.

“Cottonwood REIT” means Cottonwood Communities, Inc., a Maryland corporation.

“Cottonwood REIT Change of Control” means (i) Daniel Shaeffer and Chad Christensen cease to be members of the board of directors of Cottonwood REIT; provided, however, the death or incapacity of one of these directors will not constitute a Cottonwood REIT Change of Control if Administrative Agent provides its written consent to a replacement director and (ii) with respect to the independent directors of Cottonwood REIT, the replacement (other than solely by reason of retirement at age fifty-five (55) or older, death or disability) of more than fifty percent (50%) (or such lesser percentage as is required for decision-making by the board of directors or an equivalent governing body) of the members of the board of directors (or an equivalent governing body) of Cottonwood REIT, over a one-year period from the directors who constituted such board of directors at the beginning of such period and such replacement shall not have been approved by a vote of at least a majority of the board of directors of Cottonwood REIT, then still in office who either were members of such board of directors at the beginning of such one-year period or whose election as members of the board of directors was previously so approved (it being understood and agreed that in the case of any entity governed by a trustee, board of managers, or other similar governing body, the foregoing shall apply thereto by substituting such governing body and the members thereof for the board of directors and members thereof, respectively).

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“Covered Entity” means any of the following: (a) a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b); (b) a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or (c) a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b).

“Covered Party” has the meaning assigned to it in Section 11.20.

“Credit Party” means Administrative Agent or any other Lender.

“Debt Service Coverage Ratio” means, as of any determination date, the ratio of NOI as of such determination date to Annual Debt Service as of such determination date.

“Debtor Relief Laws” means any applicable liquidation, conservatorship, bankruptcy, moratorium, rearrangement, insolvency, fraudulent conveyance, reorganization, or similar laws affecting the rights, remedies or recourse of creditors generally, including without limitation, the United States Bankruptcy Code and all amendments thereto, as are in effect from time to time during the term of the Loans.

“Debt Yield” means, as of any date of determination, NOI divided by the aggregate then-outstanding principal balance of the Loans. Debt Yield will be measured quarterly by Borrower’s delivery of a Compliance Certificate in accordance with Section 4.09(a)(iii) of this Agreement, and Administrative Agent’s confirmation thereof.

“Default” has the meaning assigned to it in Section 8.01 hereof.

“Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable.

“Defaulting Lender” means any Lender that (a) has failed, within two Business Days of the date required to be funded or paid, to (i) fund any portion of its Loan, or (ii) pay over to any Credit Party any other amount required to be paid by it hereunder, unless in the case of clause (i) above, such Lender notifies Administrative Agent in writing that such failure is the result of such Lender’s good faith determination that a condition precedent (specifically identified and including the particular Default, if any) to funding has not been satisfied; (b) has notified Borrower or any Credit Party in writing, or has made a public statement, to the effect that it does not intend or expect to comply with any of its funding obligations under this Agreement (unless such writing or public statement indicates that such position is based on such Lender’s good faith determination that a condition precedent (specifically identified and including the particular Default, if any) to funding cannot be satisfied) or generally under other agreements in which it commits to extend credit; (c) has failed, within three Business Days after request by a Credit Party, acting in good faith, to provide a certification in writing from an authorized officer of such Lender that it will comply with its obligations (and is financially able to meet such obligations as of the date of certification) to fund under this Agreement, provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c), upon such Credit Party’s receipt of such certification in form and substance satisfactory to it and Administrative Agent; or (d) has become the subject of (A) a Bankruptcy Event or (B) a Bail-In Action.

“Dollars” or “$” refers to lawful money of the United States of America.

“Early Opt-in Election” means the occurrence of:

(1)    (i) a determination by Administrative Agent or (ii) a notification by the Required Lenders to Administrative Agent (with a copy to Borrower) that the Required Lenders have determined that U.S. dollar-denominated syndicated credit facilities being executed at such time, or that include language similar to that contained in Section 3.09 are being executed or amended, as applicable, to incorporate or adopt a new benchmark interest rate to replace the LIBO Rate, and

(2)    (i) the election by Administrative Agent or (ii) the election by the Required Lenders to declare that an Early Opt-in Election has occurred and the provision, as applicable, by Administrative Agent of written notice of such election to Borrower and the Lenders or by the Required Lenders of written notice of such election to Administrative Agent.

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“EEA Financial Institution” means (a) any institution established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.

“EEA Member Country” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.

“EEA Resolution Authority” means any public administrative authority or any Person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

“Electronic Signature” means an electronic sound, symbol, or process attached to, or associated with, a contract or other record and adopted by a Person with the intent to sign, authenticate or accept such contract or record.

“Eligible Real Estate” means Real Estate which is :

(a)    (i) wholly-owned in fee by a Co-Borrower or Potential Co-Borrower, together with such easements, rights-of-way, and other similar appurtenances required for the operation of such fee property, (ii) free from any material structural, environmental and/or title defects, (iii) otherwise free of any Liens (other than Permitted Encumbrances), and (iv) a Co-Borrower or a Potential Co-Borrower has the right to take the following actions without the need to obtain the consent of any Person: (A) to create Liens on such Property as security for Indebtedness of Co-Borrower or a Potential Co-Borrower, and (B) to sell, transfer or otherwise dispose of such Real Estate;

(b)    a completed multi-family property located within the forty-eight (48) contiguous States of the United States or the District of Columbia (but does not constitute raw land or developed land on which “ground-up” construction of improvements is ongoing and has not otherwise been completed in accordance with the related plans and specifications therefor) and has an Occupancy Rate of at least 80%;

(c)    as to which all of the representations set forth in Article VI of this Agreement concerning the Collateral are true and correct in all material respects; and

(d)    or will upon the completion and delivery of Eligible Real Estate Qualification Documents be subject to a Mortgage and as to which Administrative Agent has received and approved all Eligible Real Estate Qualification Documents, or will receive and approve them prior to inclusion of such Real Estate as Collateral.

“Eligible Real Estate Qualification Documents” are described in Schedule 3.18 attached hereto.

“Employee Benefit Plan” means an employee benefit plan as defined in Section 3(3) of ERISA, maintained, sponsored by or contributed to by Borrower or any ERISA Affiliate.

“Environmental Indemnity Agreement” means that certain Environmental Indemnity Agreement of even date herewith executed by Borrower and Guarantor in favor of Administrative Agent, for the benefit of Lenders, as amended from time to time.

“Environmental Laws” means any local, state or federal law, rule (having the effect of law), regulation or order (having the effect of law) relating to the manufacture, storage, use, handling, discharge, transport, disposal, treatment or clean-up of hazardous or toxic substances or materials, including, without limitation, “CERCLA”, “RCRA”, or state superlien or environmental clean-up statutes.

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“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time and the rules and regulations promulgated thereunder.

“ERISA Affiliate” means any trade or business (whether or not incorporated) that, together with Borrower, is treated as a single employer under Section 414(b) or (c) of the Code or Section 4001(14) of ERISA or, solely for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single employer under Section 414 of the Code.

“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor Person), as in effect from time to time.

“Eurodollar Advance” means an Advance which, except as otherwise provided in Section 3.08(c) hereof, bears interest at the applicable Eurodollar Rate.

“Eurodollar Loan” means a Loan which, except as otherwise provided in Section 3.08(c) hereof, bears interest at the applicable Eurodollar Rate.

“Eurodollar Rate” means, with respect to a Eurodollar Advance for the relevant Interest Period, a per annum rate of interest equal to the Adjusted LIBO Rate for such Interest Period plus the Applicable Margin.

“Excluded Swap Obligation” means, with respect to Guarantor, any Swap Obligation if, and to the extent that, all or a portion of any Guarantee of Guarantor of, or the grant by Guarantor of a security interest to secure, such Swap Obligation (or any Guarantee thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of Guarantor’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act and the regulations thereunder at the time any Guarantee of such Guarantor or the grant of such security interest becomes or would become effective with respect to such Swap Obligation. If a Swap Obligation arises under a master agreement governing more than one swap, such exclusion shall apply only to the portion of such Swap Obligation that is attributable to swaps for which such Guarantee or security interest is or becomes illegal.

“Excluded Taxes” means any of the following Taxes imposed on or with respect to a Recipient or required to be withheld or deducted from a payment to a Recipient: (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result of such Recipient being organized under the laws of, or having its principal office or, in the case of any Lender, its applicable lending office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Loan or Commitment pursuant to a law in effect on the date on which (i) such Lender acquires such interest in the Loan or Commitment (other than pursuant to an assignment request by Borrower under Section 3.14(b)) or (ii) such Lender changes its lending office, except in each case to the extent that, pursuant to Section 3.12, amounts with respect to such Taxes were payable either to such Lender’s assignor immediately before such Lender acquired the applicable interest in a Loan or Commitment or to such Lender immediately before it changed its lending office, (c) Taxes attributable to such Recipient’s failure to comply with Section 3.12(f) and (d) any U.S. Federal withholding Taxes imposed under FATCA.

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof and any agreement entered into pursuant to Section 1471(b)(1) of the Code and any fiscal or regulatory legislation, rules or practices adopted pursuant to any intergovernmental agreement, treaty or convention among Governmental Authorities and implementing such Sections of the Code.

“Federal Funds Effective Rate” means, for any day, the rate calculated by the NYFRB based on such day’s federal funds transactions by depository institutions (as determined in such manner as shall be set forth on the Federal Reserve Bank of New York’s Website from time to time) and as published on the next succeeding Business Day by NYFRB as the effective federal funds rate; provided that if the Federal Funds Effective Rate as so determined shall be less than zero, such rate shall be deemed to be zero for the purposes of this Agreement.

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“Federal Reserve Bank of New York’s Website” means the website of the NYFRB at http://www.newyorkfed.org, or any successor source.

“Federal Reserve Board” means the Board of Governors of the Federal Reserve System of the United States of America.

“FEMA” means the Federal Emergency Management Agency, or its successor agency..

“First Extended Maturity Date” has the meaning set forth in Section 3.15(a) hereof.

“Floating Rate Advance” means an Advance which, except as otherwise provided in Section 3.08(c) hereof, bears interest at the Floating Rate.

“Floating Rate Loan” means a Loan which, except as otherwise provided in Section 3.08(c) hereof, bears interest at the Floating Rate.

“Floating Rate” means, for any day, a rate per annum equal to the Alternate Base Rate for such day plus the Applicable Margin for such day.

“Flood Laws” means the National Flood Insurance Act of 1968, the Flood Disaster Protection Act of 1973, the National Flood Insurance Reform Act of 1994, the Biggert-Waters Flood Insurance Act of 2012, as such statutes may be amended or re-codified from time to time, any substitution therefor, any regulations promulgated thereunder, and all other Legal Requirements relating to flood insurance.

“Foreign Lender” means (a) if Borrower is a U.S. Person, a Lender that is not a U.S. Person, and (b) if Borrower is not a U.S. Person, a Lender that is resident or organized under the laws of a jurisdiction other than that in which Borrower is resident for tax purposes.

“Form Lease” means the form of lease for the Improvements or any portion thereof to be reviewed and approved by Administrative Agent.

“Future Commitment” has the meaning assigned to it in Section 3.16(e) hereof.

“GAAP” means generally accepted accounting principles in the United States of America.

“Governmental Authority” means the government of the United States of America, any other nation or any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.

“Guarantee” of or by any Person (the “guarantor”) means any obligation, contingent or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of the guarantor, direct or indirect, (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation or to purchase (or to advance or supply funds for the purchase of) any security for the payment thereof, (b) to purchase or lease property, securities or services for the purpose of assuring the owner of such Indebtedness or other obligation of the payment thereof, (c) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation or (d) as an account party in respect of any letter of credit or letter of guaranty issued to support such Indebtedness or obligation; provided, that the term Guarantee shall not include endorsements for collection or deposit in the ordinary course of business.

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“Guarantor” initially means Cottonwood Communities, O.P., LP., a Delaware limited partnership; provided, however, Borrower shall have the right to provide a substitute Guarantor to become the “Guarantor” provided that such substitute is acceptable to Administrative Agent and Lenders in their sole discretion, and in connection therewith, Administrative Agent and Lenders hereby conditionally approve Cottonwood REIT as a substitute Guarantor, subject, however to the satisfaction of the Substitute Guarantor Conditions as of the date Borrower proposes Cottonwood REIT to become the “Guarantor”.

“Hazardous Substances” shall have the meaning set forth in the Environmental Indemnity Agreement.

“High Debt Yield Margin Period” means any applicable period that is not a Low Debt Yield Margin Period, including the period from and after the date hereof.

“IBA” has the meaning assigned to such term in Section 1.03.

“Impacted Interest Period” has the meaning set forth in the definition of “LIBO Rate”.

“Improvements” shall have the meaning ascribed to it in the preamble.

“Increase Effective Date” shall have the meaning ascribed to it Section 3.17(d).

“Indebtedness” of any Person means, without duplication, (a) all obligations of such Person for borrowed money or with respect to deposits or advances of any kind, (b) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of such Person upon which interest charges are customarily paid, (d) all obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person, (e) all obligations of such Person in respect of the deferred purchase price of property or services (excluding current accounts payable incurred in the ordinary course of business), (f) all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed, (g) all Guarantees by such Person of Indebtedness of others, (h) all Capital Lease Obligations of such Person, (i) all obligations, contingent or otherwise, of such Person as an account party in respect of letters of credit and letters of guaranty, (j) all obligations, contingent or otherwise, of such Person in respect of bankers’ acceptances, and (k) all Swap Obligations. The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor.

“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of Borrower under any Loan Document and (b) to the extent not otherwise described in the foregoing clause (a), Other Taxes.

“Indemnitee” has the meaning set forth in Section 11.03(b) hereof.

“Ineligible Institution” has the meaning assigned to it in Section 11.04.

“Initial Maturity Date” means March 19, 2023.

“Interest Election Request” means a request by Borrower to convert or continue an Advance in accordance with Section 3.04 hereof.

“Interest Payment Date” means the fifth (5^th) day of each month and the Maturity Date.

“Interest Period” means with respect to any Eurodollar Advance, the period commencing on the date of such Eurodollar Advance and ending on the numerically corresponding day in the calendar month that is one, two, three or six months thereafter, as Borrower may elect; provided, that (a) if any Interest Period would end on a

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day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day and (b) any Interest Period that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest Period. For purposes hereof, the date of an Advance initially shall be the date on which such Advance is made and thereafter shall be the effective date of the most recent conversion or continuation of such Advance.

“Interpolated Rate” means, at any time, for any Interest Period, the rate per annum (rounded to the same number of decimal places as the LIBO Screen Rate) determined by Administrative Agent (which determination shall be conclusive and binding absent manifest error) to be equal to the rate that results from interpolating on a linear basis between: (a) the LIBO Screen Rate for the longest period (for which the LIBO Screen Rate is available) that is shorter than the Impacted Interest Period and (b) the LIBO Screen Rate for the shortest period (for which the LIBO Screen Rate is available) that exceeds the Impacted Interest Period, in each case, at such time.

“IRS” means the United States Internal Revenue Service.

“JPMorgan” has the meaning set forth in the preamble.

“Lease” means any lease or other agreement for the use and occupancy of all or any portion of the Improvements, whether now in existence or hereafter arising.

“Legal Requirements” means any and all judicial decisions, statutes, rulings, directions, rules, regulations, permits, certificates or ordinances of any Governmental Authority in any way applicable to Borrower or the Property or Improvements, including, without limitation, the ownership, division, use, occupancy, possession, operation, maintenance, alteration, repair or reconstruction thereof.

“Lender Parent” means, with respect to any Lender, any Person as to which such Lender is, directly or indirectly, a subsidiary.

“Lender Reply Period” has the meaning assigned to it in Section 11.09 hereof.

“Lenders” means the Persons listed on Schedule 1.01(a) and any other Person that shall have become a party hereto pursuant to an Assignment and Assumption or otherwise, other than any such Person that ceases to be a party hereto pursuant to an Assignment and Assumption or otherwise; provided, however, Administrative Agent shall endeavor to provide reasonable prior written notice to Borrower of the intent for any Person other than the Person listed on Schedule 1.01(a) as of the date hereof to become a party hereto.

“Lessee” means a tenant under a Lease.

“LIBO Rate” means, with respect to any Eurodollar Advance for any Interest Period, the LIBO Screen Rate at approximately 11:00 a.m., London time, two (2) Business Days prior to the commencement of such Interest Period; provided, that if the LIBO Screen Rate shall not be available at such time for Interest Period (an “Impacted Interest Period”), then the LIBO Rate shall be the Interpolated Rate.

“LIBO Screen Rate” means, for any day and time, with respect to any Eurodollar Advance for any Interest Period, the London interbank offered rate administered by the ICE Benchmark Administration (or any other Person that takes over the administration of such rate for U.S. Dollars) for a period equal in length to such Interest Period as displayed on such day and time on pages LIBOR01 or LIBOR02 of the Reuters Screen or, in the event such rate does not appear on a Reuters page or screen, on any successor or substitute page on such screen that displays such rate, or on the appropriate page of such other information service that publishes such rate as shall be selected by Administrative Agent from time to time in its reasonable discretion, provided, that if the LIBO Screen Rate as so determined would be less than zero, such rate shall be deemed to be zero for purposes of this Agreement.

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“Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien, pledge, hypothecation, encumbrance, charge or security interest in, on or of such asset, (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset and (c) in the case of securities, any purchase option, call or similar right of a third party with respect to such securities.

“Limited Guaranty” means the Guaranty of even date herewith executed by Guarantor in favor of Administrative Agent, for the benefit of Lenders, as amended from time to time, evidencing guaranties by the Guarantor with respect to certain acts of Borrower.

“Loan” or “Loans” means, with respect to any Lender, any loans made by such Lender pursuant to this Agreement (or any conversion or continuation thereof).

“Loan Documents” means this Agreement, including schedules and exhibits hereto, the Notes, the Mortgage, the Assignment of Rents, the Limited Guaranty, the Environmental Indemnity Agreement, the Property Manager Subordination Agreement, and any and all other documents now or hereafter executed by Borrower, Guarantor or any other guarantor of the Obligations or any portion thereof evidencing, guarantying, securing or otherwise pertaining to the Obligations including any amendments, modifications or supplements thereto or waivers thereof, legal opinions issued in connection with the other Loan Documents, UCC filings, and any other documents prepared in connection with the other Loan Documents, if any; provided, however, that Swap Agreements between Borrower and any Lender or Affiliate of any Lender shall not constitute Loan Documents.

“Loan Fee” has the meaning set forth in Section 3.07(a).

“Loan-to-Value Ratio” means the ratio, expressed as a percentage, of (a) the Aggregate Commitment to (b) the Appraised Value.

“Low Debt Yield Margin Period” means any applicable period beginning with the first day of the first Interest Period following the date on which Borrower has demonstrated to Administrative Agent by delivery of a Compliance Certificate pursuant to Section 4.09(a)(iii) that the Debt Yield with respect to the period covered by such Compliance Certificate is less than 8.0%, and ending on the last day of the first Interest Period following the date on which Borrower has demonstrated to Administrative Agent by delivery of a Compliance Certificate pursuant to Section 4.09(a)(iii) that the Debt Yield for the period covered by such Compliance Certificate equals or exceeds 8.0%.

“Material Borrower Indebtedness” has the meaning set forth in Section 8.01(aa) hereof.

“Material Guarantor Indebtedness” has the meaning set forth in Section 8.01(x) hereof.

“Maturity Date” means the Initial Maturity Date as such date may be extended pursuant to Section 3.15 hereof.

“Maximum Rate” has the meaning set forth in Section 11.13 hereof.

“Mortgage” means the Mortgage, Security Agreement, Assignment of Leases and Rents and Fixture Filing of even date herewith executed by Borrower in favor of Administrative Agent, for the benefit of Lenders, as amended from time to time.

“Mortgaged Property” means the Property, the Improvements and all other property of Borrower subject to a Lien or security interest granted by any of the Loan Documents.

“Net Casualty Proceeds” shall have the meaning set forth in Section 7.01(g)(ii) hereof.

“Net Condemnation Proceeds” shall have the meaning set forth in Section 7.02 hereof.

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“New Investor” means any Person which is either (i) not a wholly owned subsidiary of Guarantor or (ii) not specifically identified in Borrower’s organizational chart attached hereto as Schedule 1.01(b).

“NOI” means, as of any date of determination, an amount equal to (i) Total Revenues, as of such date of determination, minus (ii) Property Operating Expenses as of such date of determination, in each case construed in accordance with GAAP consistently applied.

“Non-Defaulting Lender” means any Lender, as determined by Administrative Agent, that is not a Defaulting Lender.

“Notes” means the Promissory Notes executed by Borrower in favor of each of the Lenders, substantially in the form of Exhibit B, as amended from time to time.

“NYFRB” means the Federal Reserve Bank of New York.

“NYFRB Rate” means, for any day, the greater of (a) the Federal Funds Effective Rate in effect on such day and (b) the Overnight Bank Funding Rate in effect on such day (or for any day that is not a Business Day, for the immediately preceding Business Day); provided that if both such rates are not so published for any day that is a Business Day, the term “NYFRB Rate” means the rate quoted for such day, for a federal funds transaction at 11:00 a.m. on such day received by Administrative Agent from a federal funds broker of recognized standing selected by it; provided, further, that if any of the aforesaid rates as so determined would be less than zero, such rate shall be deemed to be zero for purposes of this Agreement.

“Obligations” means (i) all unpaid principal of and accrued and unpaid interest on the Loans, all accrued and unpaid fees and all expenses, reimbursements, indemnities and other indebtedness, liabilities, or obligations of Borrower to the Lenders or to any Lender, Administrative Agent or any indemnified party arising under the Loan Documents, and (ii) all Swap Obligations under Swap Agreements with one or more Lenders or their respective Affiliates, provided that at or prior to the time that any transaction relating to such Swap Obligation is executed, the Lender counterparty thereto (other than JPMorgan or its Affiliates) shall have delivered written notice to Administrative Agent that such a transaction has been or will be entered into and, subject to Administrative Agent’s prior approval in its reasonable discretion, such Swap Obligation shall constitute an Obligation entitled to the benefits of the liens and guaranties provided by the Loan Documents, provided, however, that the definition of ‘Obligations’ shall exclude any Excluded Swap Obligations of any Guarantor for purposes of determining any obligations of any Guarantor.

“Occupancy Rate” means, with respect to any Real Estate at any time, the ratio, expressed as a percentage, of (a) the number of units actually leased to non-Affiliate tenants who are not subject to a Bankruptcy Event and who are paying rent at rates not materially less than rates generally prevailing at the time the applicable lease was entered into, pursuant to binding leases as to which no monetary default with respect to regularly scheduled payments in excess of $500.00 has occurred and has continued unremedied for sixty (60) or more days to (b) the aggregate number of units of such property. For purposes of this definition, a tenant shall be deemed to actually occupy Real Estate notwithstanding a temporary cessation of operations for renovations, repairs or other temporary reason.

“OFAC” means the Office of Foreign Assets Control of the United States Department of the Treasury.

“Operating Costs” means the costs and expenses for the operation and maintenance of the Property and the Improvements.

“Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to, or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).

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“Other Taxes” means all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment (other than an assignment made pursuant to Section 3.14).

“Overnight Bank Funding Rate” means for any day, the rate comprised of both overnight federal funds and overnight Eurodollar borrowings by U.S.–managed banking offices of depository institutions (as such composite rate shall be determined by the NYFRB as set forth on the Federal Reserve Bank of New York’s Website from time to time) and published on the next succeeding Business Day by the NYFRB as an overnight bank funding rate.

“Participant” has the meaning set forth in Section 11.04(c)(i) hereof.

“Participant Register” has the meaning assigned to such term in Section 11.04(c)(i).

“Patriot Act” has the meaning assigned to it in Section 11.14.

“Permits” means all permits, licenses, certificates and approvals now or hereafter issued to Borrower for the operation of the Mortgaged Property.

“Permitted Encumbrances” means (a) Liens and security interests granted pursuant to the Loan Documents, (b) the items set forth on Schedule B of the Title Policy, (c) customary easements entered into by Borrower in connection with the development and operation of the Mortgaged Property which Administrative Agent has determined would have no material adverse effect on the use or value of the Mortgaged Property, (d) documents required to be recorded by applicable law which have no material adverse effect on the use or value of the Mortgaged Property, (e) Leases executed in accordance with the terms of this Agreement, (f) Liens, if any, for Taxes imposed by any Governmental Authority not yet due or delinquent, (g) such other title and survey exceptions as Administrative Agent approves pursuant to the provisions of this Agreement, and (h) equipment leases for equipment which is not affixed to the Land or Improvements used at the Property so long as the same are secured, if at all, solely by the subject equipment leased thereunder, and the obligations of Borrower with respect thereto constitute Permitted Indebtedness hereunder.

“Permitted Indebtedness” means (a) the Obligations, (b) unsecured letters of credit or guarantees required by Governmental Authorities in connection with the construction of the Improvements, (c) trade debt incurred in the ordinary course of operation of the Mortgaged Property in such amounts as are normal and reasonable under the circumstances, provided that such debt is not evidenced by a note and is paid when due and provided in any event that the outstanding principal balance of such debt shall not exceed at any one time one percent (1%) of the outstanding Aggregate Commitment, (d) equipment leases entered into in the ordinary course of the operation of the Mortgaged Property and (e) Leases executed in accordance with the terms of this Agreement.

“Permitted Transfers” means any of the following transfers, which shall be permitted without the consent of Administrative Agent or any Lender, provided that (i) at all times Cottonwood REIT Controls Borrower and Guarantor and directly or indirectly owns twenty-five percent or more of the equity interests in Borrower and Guarantor, (ii) no Cottonwood REIT Change of Control has occurred or will occur as a result of the transfer in question, (iii) Property Manager, or another property manager approved by Administrative Agent and the Lenders is the property manager of the Property, and (iv) the Permitted Transfer Conditions are satisfied:

1.    The issuance, sale, conveyance, transfer or other disposition of any shares (the “REIT Shares”) of common, preferred or other series of stock in Cottonwood REIT;

2.    The issuance, sale, conveyance, assignment, pledge, transfer or other disposition of any limited partnership interests (the “OP Interests”) in Guarantor;

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3.    Registering the REIT Shares or the OP Interests with the Securities and Exchange Commission pursuant by a filing of a Form S-11 Registration Statement or otherwise; or

4.    Any sale, transfer or conveyance of any direct or indirect ownership interest in Borrower or Guarantor to any Affiliate of Borrower of Guarantor, respectively.

“Permitted Transfer Conditions” means all of the following:

1.    Except with respect to transfers permitted pursuant to paragraphs 1, 2 or 3 of the definition of “Permitted Transfers”, no Default shall exist under any of the Loan Documents;

2.    No such transfer would result in the breach of the representations and warranties in Sections 6.01(n), or would result in a violation of any Legal Requirement applicable to any Lender;

3.    Administrative Agent shall have received, prior to any transfer to a New Investor acquiring twenty-five percent (25%) or more of the direct or indirect interests in Borrower, notice of the proposed transfer and such information and documentation regarding any New Investor acquiring twenty-five percent (25%) or more of the direct or indirect interests in Borrower as may be reasonably requested by Administrative Agent in order to comply with any Legal Requirements applicable to Administrative Agent or any Lender and any related internal policies and procedure;

4.    With respect to any New Investor who acquires twenty-five percent (25%) or more of the direct or indict interests in Borrower, Administrative Agent shall have determined, in its sole and absolute discretion, that such transfer to each New Investor who acquires twenty-five percent (25%) or more of the direct or indict interests in Borrower will satisfy the conditions specified in clauses (2) and (3) above and will not impose any potential liability or claim upon Administrative Agent or any Lender (including the imposition of any Taxes, fines, penalties or other sanctions of any domestic or foreign Governmental Authority);

5.    Except for transfers permitted pursuant to paragraphs 1, 2 or 3 of the definition of “Permitted Transfer”, Borrower shall provide Administrative Agent with notice of the transfer no later than ten (10) Business Days following the effective date of the transfer;

6.    Except for transfers permitted pursuant to paragraphs 1, 2 or 3 of the definition of “Permitted Transfer”, Borrower shall pay all costs and expenses, including reasonable attorneys’ fees and disbursements incurred by Administrative Agent in connection with any Permitted Transfer; and

7.    Borrower shall, upon Administrative Agent’s written request from time to time, deliver to Administrative Agent such updates to the organizational chart of Borrower and its constituents to reflect the status of Borrower’s direct and indirect ownership as reasonably required by Administrative Agent.

“Person” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.

“Plan Asset Regulations” means 29 C.F.R. Section 2510.3-101 as modified by Section 3(42) of ERISA, as amended from time to time.

“Potential Co-Borrower” means a wholly-owned subsidiary of Guarantor.

“Potential Collateral” means any property of a Potential Co-Borrower which is not at the time the Mortgaged Property and which consists of (i) Eligible Real Estate, or (ii) Real Estate which is capable of becoming Eligible Real Estate through the completion and delivery of Eligible Real Estate Qualification Documents.

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“Prime Rate” means the rate of interest last quoted by The Wall Street Journal as the “Prime Rate” in the U.S. or, if The Wall Street Journal ceases to quote such rate, the highest per annum interest rate published by the Federal Reserve Board in Federal Reserve Statistical Release H.15 (519) (Selected Interest Rates) as the “bank prime loan” rate or, if such rate is no longer quoted therein, any similar rate quoted therein (as determined by Administrative Agent) or any similar release by the Federal Reserve Board (as determined by Administrative Agent). Each change in the Prime Rate shall be effective from and including the date such change is publicly announced or quoted as being effective.

“Project” means the acquisition, ownership and operation of the Property and the Improvements.

“Project Documents” means the Property Management Agreement and any other material agreement relating to the ownership, financing, development or operation of the Improvements to which Borrower is a party or beneficiary, and for which the annual obligation of Borrower under any such agreement exceeds $100,000, whether now existing or hereafter arising; provided, however, that Project Documents shall not include the Loan Documents, the Required Third Party Documents, any Swap Agreement, the Leases or any agreement that is terminable upon not more than 30 days’ prior written notice without payment of any termination fee or penalty.

“Property” has the meaning set forth in the Recitals.

“Property Management Agreement” means that certain Property Management Agreement dated as of March 19, 2020 by and between Borrower and Property Manager, and any and all extensions, renewals, modifications, amendments, supplements and replacements thereto and therefor.

“Property Manager” means Cottonwood Communities Management, LLC, a Delaware limited liability company.

“Property Manager Subordination Agreement” means the Assignment of Management Agreement and Subordination of Management Fees of even date herewith executed by Property Manager in favor of Administrative Agent, for the benefit of the Lenders, as amended from time to time.

“Property Operating Expenses” means, as of any date of determination, the sum (without duplication) of (i) the following for the most recently completed 12 month period, annualized: (a) all expenses incurred in connection with the ownership, maintenance and operation of the Mortgaged Property, including, without limitation, utilities, license fees, ground rent, ordinary repairs and maintenance, insurance premiums and Taxes (excluding state and federal income taxes), and (b) property management fees for the Mortgaged Property in an amount equal to the greater of the actual property management fees incurred and three percent (3%) of Total Revenues for the applicable period; and (ii) imputed capital improvements reserves with respect to the Mortgaged Property in the amount of $250 per unit per annum. Property Operating Expenses shall be subject to such adjustments as shall be required in Administrative Agent’s reasonable judgment to make the sum representative of fully occupied, stabilized operations at the Mortgaged Property, including, without limitation, such adjustment as shall be necessary to reflect fully assessed real estate taxes based on the fully assessed value contained in the most recent tax bill for the Mortgaged Property; provided, however, no such adjustment shall include any state or federal income tax. Property Operating Expense shall exclude debt service charges, depreciation, amortization, and other non-cash expenses and shall be subject to appropriate seasonal and other adjustments as approved by Administrative Agent.

“PTE” means a prohibited transaction class exemption issued by the U.S. Department of Labor, as any such exemption may be amended from time to time.

“QFC” has the meaning assigned to the term “qualified financial contract” in, and shall be interpreted in accordance with, 12 U.S.C. 5390(c)(8)(D).

“QFC Credit Support” has the meaning assigned to it in Section 11.20.

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“Qualified Financial Institution” means a financial institution with a long term corporate debt rating of at least “A” from Standard and Poor’s Rating Group or a comparable rating by a rating agency acceptable to Administrative Agent.

“Recipient” means (a) Administrative Agent and (b) any Lender, as applicable.

“Real Estate” means all real property at any time owned by Borrower, a Co-Borrower or a Potential Co-Borrower, including, without limitation, the Mortgaged Property.

“Register” has the meaning set forth in Section 11.04(b)(iv) hereof.

“Regulation D” means Regulation D of the Federal Reserve Board, as in effect from time to time and all official rulings and interpretations thereunder or thereof.

“Related Parties” means, with respect to any specified Person, such Person’s Affiliates and the respective directors, officers, employees, agents and advisors of such Person and such Person’s Affiliates.

“Relevant Governmental Body” means the Federal Reserve Board and/or the NYFRB, or a committee officially endorsed or convened by the Federal Reserve Board and/or the NYFRB or, in each case, any successor thereto.

“Report” has the meaning set forth in Section 4.10(a) hereof.

“Required Lenders” means Lenders (other than Defaulting Lenders) in the aggregate having at least 66 2/3% of the Aggregate Commitment or, if the Aggregate Commitment has been terminated, Lenders in the aggregate holding at least 66 2/3% of the aggregate unpaid principal amount of the outstanding Advances.

“Required Lender BBP Deliverables” means, with respect to any Potential Collateral for which Borrower seeks approval, on behalf of a Potential Co-Borrower, as Collateral in accordance with the provisions of Section 3.18, all of the following: (i) a summary description of the applicable Real Estate (including without limitation, the street address of such Real Estate, the size and type of property and such other information as may reasonably be required by Administrative Agent and the Lenders to identify the location and the material characteristics of such Real Estate); (ii) a copy of the operating statements for such Real Estate for the last three (3) fiscal years (or such shorter period as may be available) and the interim operating statement for the most recent fiscal quarter; (iii) a copy of a current rent roll for such Real Estate; (iv) a summary of the historical Occupancy Rates for such Real Estate for the last ten (10) years (or such shorter period as may be available); (v) a copy of the Appraisal for such Real Estate; (vi) evidence as to whether the applicable Real Estate is located in a flood hazard district as established by FEMA, or is otherwise designated by FEMA as having special flood or mudslide hazards; (vii) copies of each environmental site assessment obtained by Borrower with respect to such Real Estate; (viii) a copy of the property condition report obtained by Borrower with respect to such Real Estate; (ix) a summary of any capital improvement program that is scheduled to be undertaken at such Real Estate, if applicable, (x) such other agreements, documents, certificates, reports or assurances as Administrative Agent may reasonably require; and (xi) a new Compliance Certificate showing, on a pro forma basis, the effect of the addition of such Real Estate as Collateral.

“Required Third Party Documents” means the Property Manager Subordination Agreement.

“Requirement of Law” means, as to any Person, any law, treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject.

“Sanctioned Country” means, at any time, a country, region or territory which is itself the subject or target of any Sanctions (at the time of this Agreement, Crimea, Cuba, Iran, North Korea and Syria).

“Sanctioned Person” means, at any time, (a) any Person listed in any Sanctions-related list of designated Persons maintained by OFAC, the U.S. Department of State, (b) any Person operating, organized or resident in a Sanctioned Country, (c) an Affiliate of any such Person described in the foregoing clauses (a) or (b), or (d) any Person otherwise the subject of any Sanctions.

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“Sanctions” means all economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by the U.S. government, including those administered by OFAC or the U.S. Department of State.

“SOFR” with respect to any day means the secured overnight financing rate published for such day by the NYFRB, as the administrator of the benchmark (or a successor administrator), on the Federal Reserve Bank of New York’s Website.

“SOFR-Based Rate” means SOFR, Compounded SOFR or Term SOFR.

“Statutory Reserve Rate” means a fraction (expressed as a decimal), the numerator of which is the number one and the denominator of which is the number one minus the aggregate of the maximum reserve percentages (including any marginal, special, emergency or supplemental reserves) expressed as a decimal established by the Federal Reserve Board to which Administrative Agent is subject with respect to the Adjusted LIBO Rate, for eurocurrency funding (currently referred to as “Eurocurrency liabilities” in Regulation D). Such reserve percentages shall include those imposed pursuant to such Regulation D. Eurodollar Loans shall be deemed to constitute eurocurrency fundings and to be subject to such reserve requirements without benefit of or credit for proration, exemptions or offsets that may be available from time to time to any Lender under such Regulation D or any comparable regulation. The Statutory Reserve Rate shall be adjusted automatically on and as of the effective date of any change in any reserve percentage.

“Substitute Guarantor Conditions” means the following, as of the date the substitute Guarantor shall become the “Guarantor” under the Loan Documents: (i) Administrative Agent shall have determined that the substitute Guarantor shall have satisfied the financial covenants set forth in Section 10(c) of the Limited Guaranty; (ii) the organizational documents of the substitute Guarantor shall be reasonably satisfactory to Administrative Agent; (iii) the substitute Guarantor shall have executed and delivered a fully executed original Limited Guaranty and Environmental Indemnity Agreement in the same forms as the Limited Guaranty and the Environmental Indemnity Agreement; and (iv) Borrower shall have caused counsel to the substitute Guarantor reasonably satisfactory to Administrative Agent to deliver customary opinions of counsel as to the formation and standing of the substitute Guarantor, the authority of the substitute Guarantor to execute, deliver and perform its obligations under such Limited Guaranty and Environmental Indemnity Agreement, the substitute Guarantor’s due execution and delivery of such Limited Guaranty and Environmental Indemnity Agreement, and the enforceability of such Limited Guaranty and Environmental Indemnity Agreement, and such other matters as may be reasonably requested by Administrative Agent, in each case in form reasonably satisfactory to Administrative Agent.

“Supported QFC” has the meaning assigned to it in Section 11.20.

“Survey” has the meaning set forth in Section 2.02(b)(v) hereof.

“Swap Agreement” means any agreement, contract or transaction that constitutes a “swap” within the meaning of Section 1a(47) of the Commodity Exchange Act.

“Swap Obligations” of a Person means any and all obligations of such Person, whether absolute or contingent and howsoever and whensoever created, arising, evidenced or acquired (including all renewals, extensions and modifications thereof and substitutions therefor), under (a) any and all Swap Agreements, and (b) any and all cancellations, buy backs, reversals, terminations or assignments of any Swap Agreement transaction.

“Taxes” means all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), value added taxes, or any other goods and services, use or sales taxes, assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

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“Term SOFR” means the forward-looking term rate based on SOFR that has been selected or recommended by the Relevant Governmental Body.

“Title Company” means Old Republic National Title Insurance Company.

“Title Policy” means an ALTA Lender’s Policy of Title Insurance in form and substance satisfactory to Administrative Agent issued by the Title Company in the amount of the Aggregate Commitment insuring the Mortgage as a first priority lien on the Property and the Improvements, containing such endorsements and with such re-insurance as Administrative Agent may request, excepting only such items as shall be acceptable to Administrative Agent.

“Total Revenues” means, as of any date of determination, the sum (without duplication) of the following: (i) the actual gross rental revenue received by Borrower from Lessees in occupancy and paying rent as of such date of determination for the most recently completed three (3) month period, annualized; and (ii) any other actual operating revenue received by Borrower from the Mortgaged Property of a recurring nature, as reasonably determined by Administrative Agent, for the most recently completed twelve (12) month period. Total Revenues as of any date of determination shall exclude security deposits not yet applied in accordance with the underlying applicable Lease, insurance proceeds and condemnation awards and other extraordinary items of income. Total Revenues shall also be subject to an economic vacancy allowance equal to the greater of actual or 5%.

“Transactions” means the execution, delivery and performance by Borrower of this Agreement and the other Loan Documents, the borrowing of Loans and the use of the proceeds thereof.

“Type” means, with respect to any Advance, its nature as a Floating Rate Advance or a Eurodollar Advance and with respect to any Loan, its nature as a Floating Rate Loan or Eurodollar Loan.

“Unadjusted Benchmark Replacement” means the Benchmark Replacement excluding the Benchmark Replacement Adjustment; provided that, if the Unadjusted Benchmark Replacement as so determined would be less than zero, the Unadjusted Benchmark Replacement will be deemed to be zero for the purposes of this Agreement.

“Undrawn Fee” has the meaning assigned to it in Section 3.07(c).

“Undrawn Fee Rate” means, for any calendar quarter, an annualized percentage equal to fifteen (15) basis points.

“Unmatured Default” means the occurrence of an event which with notice or lapse of time or both would constitute a Default.

“U.S. Person” means a “United States person” within the meaning of Section 7701(a)(30) of the Code.

“U.S. Special Resolution Regime” has the meaning assigned to it in Section 11.20.

“U.S. Tax Compliance Certificate” has the meaning assigned to such term in Section 3.12(f)(ii)(B)(3).

“Write-Down and Conversion Powers” means, with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.

1.02    Terms Generally. The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include”, “includes” and “including” shall be deemed to be

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followed by the phrase “without limitation”. The word “will” shall be construed to have the same meaning and effect as the word “shall”. Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (b) any reference herein to any Person shall be construed to include such Person’s successors and assigns, (c) the words “herein”, “hereof” and “hereunder”, and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (d) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement and (e) any reference to any law, rule or regulation herein shall, unless otherwise specified, refer to such law, rule or regulation as amended, modified or supplemented from time to time and (f) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.

1.03    Interest Rates; LIBOR Notification. The interest rate on Eurodollar Loans is determined by reference to the LIBO Rate, which is derived from the London interbank offered rate (“LIBOR”). LIBOR is intended to represent the rate at which contributing banks may obtain short-term borrowings from each other in the London interbank market. In July 2017, the U.K. Financial Conduct Authority announced that, after the end of 2021, it would no longer persuade or compel contributing banks to make rate submissions to the ICE Benchmark Administration (together with any successor to the ICE Benchmark Administrator, the “IBA”) for purposes of the IBA setting LIBOR. As a result, it is possible that commencing in 2022, LIBOR may no longer be available or deemed an appropriate reference rate upon which to determine the interest rate on Eurodollar Loans. In light of this eventuality, public and private sector industry initiatives are currently underway to identify new or alternative reference rates to be used in place of LIBOR. Upon the occurrence of a Benchmark Transition Event or Early Opt-In Election, Section 3.09(b) provides a mechanism for determining an alternative rate of interest. Administrative Agent will promptly notify Borrower, pursuant to Section 3.09(d) of any change to the reference rate upon which the interest rate of Eurodollar Loans is based. However, Administrative Agent does not warrant or accept any responsibility for, and shall not have any liability with respect to, the administration, submission or any other matter related to LIBOR or other rates in the definition of LIBO Rate or with respect to any alternative or successor rate thereto, or replacement rate thereof (including, without limitation, (i) any such alternative, successor or replacement rate implemented pursuant to Section 3.09(b), whether upon the occurrence of a Benchmark Transition Event or an Early Opt-In Election, and (ii) the implementation of any Benchmark Replacement Conforming Changes pursuant to Section 3.09(c)), including without limitation, whether the composition or characteristics of any such alternative, successor or replacement reference rate will be similar to, or produce the same value or economic equivalence of, the LIBO Rate or have the same volume or liquidity as did LIBOR prior to its discontinuance or unavailability.

ARTICLE II

CONDITIONS TO DISBURSEMENT

2.01    Right to Advances.

(a)     Generally. Each Lender severally agrees, on the terms and conditions set forth in this Agreement, to make Loans to Borrower from time to time in amounts not to exceed in the aggregate the amount of its Commitment. Each Advance hereunder shall consist of Loans made by the several Lenders ratably in proportion to the ratio that their respective Commitments bear to the Aggregate Commitment. No Lender shall be responsible for the failure of any other Lender to perform its obligations to make Loans hereunder, and the Commitment of any Lender shall not be increased or decreased as a result of the failure by any other Lender to perform its obligation to make Loans hereunder. Borrower agrees to cause the proceeds of the Loans to be applied for the acquisition of the Property and, subject to the provisions of this Agreement, acquisition of other Eligible Real Estate by Potential Co-Borrowers that become Co-Borrowers under this Agreement, capital improvements and working capital and for no other purposes. No portion of the Advance shall be applied by Borrower to reimburse itself for costs previously funded with or credited to Borrower’s Equity Requirement. Subject to the terms and conditions set forth herein, Borrower may borrow, prepay and reborrow the Loans.

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2.02    Conditions to Closing and Initial Advance.

Borrower agrees that, in addition to all other conditions set forth herein, the making of the initial Advance on the Closing Date is conditioned upon the fulfillment of each of the following conditions, subject, however, to the right of Administrative Agent to waive any one or more of such conditions in whole or in part:

(a)    Loan Documents and Certain Third Party Documents. Administrative Agent shall have received on the date hereof the following documents fully executed and in form and substance satisfactory to Administrative Agent:

(i)    The Notes;

(ii)    The Mortgage;

(iii)    The Assignment of Rents;

(iv)    The Limited Guaranty;

(v)    The Environmental Indemnity Agreement

(vi)    The Property Manager Subordination Agreement (attaching a copy of the Property Management Agreement);

(vii)    Intentionally Omitted;

(viii)    Borrower Financing Statement;

(ix)    Intentionally Omitted;

(x)    Intentionally Omitted;

(xi)    Intentionally Omitted;

(xii)    Intentionally Omitted;

(xiii)    A completed questionnaire for disbursement instructions, rate elections and other administrative matters in the form approved by Administrative Agent.

(b)    Additional Closing Deliveries. Administrative Agent, or any Lender as applicable, shall have received the following on the date hereof in form and substance satisfactory to Administrative Agent:

(i)    An opinion or opinions from counsel for Borrower and Guarantor covering such items as Administrative Agent and its counsel may require;

(ii)    Current UCC, tax and judgment searches made in such places as Administrative Agent may specify, covering Borrower and showing no filings relating to, or which could relate to, the Mortgaged Property other than those made hereunder;

(iii)    Evidence of the insurance required under Section 7.01 hereof;

(iv)    A commitment to issue the Title Policy, together with copies of all documentation evidencing exceptions raised therein;

(v)    An ALTA/NSPS survey of the Property certified in a manner acceptable to Administrative Agent (the “Survey”);

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(vi)    Copies of organizational documents for Borrower, Guarantor and any other entity reasonably requested by Administrative Agent based on the organizational chart for Borrower, together with good standing certificates, resolutions, incumbency certificates, and such other evidence of authority to enter into the Loan Documents as Administrative Agent may reasonably require.

(vii)    Intentionally Omitted;

(viii)    A copy of the contract to purchase the Property and the related closing statement executed by Borrower;

(ix)    Evidence indicating whether the Improvements or any part thereof are or will be located within a one hundred year flood plain or other area identified by Administrative Agent as having high or moderate risk of flooding or identified as a special flood hazard area as defined by FEMA, and, if so, a flood notification form signed by Borrower and evidence that the flood insurance required by Article VII of this Agreement is in place for the Improvements and contents, if applicable, all in form, substance and amount satisfactory to Administrative Agent;

(x)    An Appraisal showing the Loan-to-Value Ratio to be no more than sixty-five percent (65%);

(xi)    Intentionally Omitted;

(xii)    An environmental report with respect to the Property prepared by an environmental consultant acceptable to Administrative Agent;

(xiii)    Intentionally Omitted;

(xiv)    Evidence indicating compliance by the Improvements with applicable zoning requirements (without requirement for a variance);

(xv)    Evidence that all utilities and municipal services required for the operation of the Improvements are available at the Property;

(xvi)    The most recent available financial statements of Borrower and Guarantor;

(xvii)    Intentionally Omitted;

(xviii)    Intentionally Omitted;

(xix)    Intentionally Omitted;

(xx)    A Certification of Non-Foreign Status;

(xxi)    A signed IRS Form W-8 or W-9 as applicable;

(xxii)    (1) At least five (5) days prior to the date hereof, all documentation and other information regarding Borrower requested in connection with applicable “know your customer” and anti-money laundering rules and regulations, including the Patriot Act, to the extent requested in writing of Borrower at least ten (10) days prior to the date hereof, and (2) to the extent Borrower qualifies as a “legal entity customer” under the Beneficial Ownership Regulation, at least five (5) days prior to the date hereof, any Lender that has requested, in a written notice to Borrower at least ten (10) days prior to the date hereof, a Beneficial Ownership Certification in relation to Borrower shall have received such Beneficial Ownership Certification (provided that, upon the execution and delivery by such Lender of its signature page to this Agreement, the condition set forth in this clause (2) shall be deemed to be satisfied; and

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(xxiii)    Such other information and documents as Administrative Agent may require.

2.03    Conditions to Future Advances.

Borrower agrees that, in addition to all other conditions set forth herein, the making of each subsequent Advance following the Closing Date is conditioned upon the fulfillment of each of the following conditions, subject, however, to the right of Administrative Agent to waive any one or more of such conditions in whole or in part

(a)    Certain Documents. Administrative Agent shall have received the following documents fully executed and in form and substance satisfactory to Administrative Agent:

(i)    A completed questionnaire for disbursement instructions, rate elections and other administrative matters in the form approved by Administrative Agent.

(ii)    Such other information and documents as Administrative Agent may require.

(b)    Debt Service Coverage Compliance. Borrower has demonstrated to the satisfaction of Administrative Agent that the Debt Service Coverage Ratio is not less than 1.15:1.00.

(c)    Loan to Value Ratio. Borrower has delivered to Administrative Agent, evidence reasonably acceptable to Administrative Agent (which evidence shall be the most recent Appraisal obtained by Administrative Agent) that, the Loan-to-Value Ratio with respect to the Property and the proposed Eligible Real Estate does not exceed 65.0%.

(d)    No Default. No Default or Unmatured Default shall have occurred and be continuing on the Initial Maturity Date.

(e)    Representation and Warranties True and Correct. All representations and warranties made hereunder or under any of the other Loan Documents shall be true and correct in all material respects as of the date of the applicable Advance, except to the extent such representation and warranty is made as of a specified date, in which case such representation and warranty shall have been true and correct as of such specified date.

ARTICLE III

LOAN TERMS

3.01    The Loan and Advances.

(a)    Generally. All Advances of the Loans are subject to satisfaction of the conditions to disbursement contained in Article II of this Agreement, as well as the terms of this Article III.

(b)    Type. Subject to Section 3.09 hereof, each Advance shall be comprised entirely of Floating Rate Loans or Eurodollar Loans as Borrower may request in accordance herewith, and shall bear interest at the applicable Floating Rate or Eurodollar Rate, respectively. Each Lender at its option may make any Eurodollar Loan by causing any domestic or foreign branch or Affiliate of such Lender to make such Loan; provided that any exercise of such option shall not affect the obligation of Borrower to repay such Loan in accordance with the terms of this Agreement.

(c)    Minimum Advance Amounts. At the commencement of each Interest Period for any Eurodollar Advance, such Advance shall be in an aggregate amount that is not less than $1,000,000.00. Advances of more than one Type may be outstanding at the same time; provided that there shall not at any time be more than a total of 5 Eurodollar Advances outstanding, and Borrower may combine any two or more Eurodollar Advances outstanding into a single Eurodollar Advance without payment of any penalty or fee of $1,000 or more, provided that the Eurodollar Advances being combined have Interest Periods ending on the same date.

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(d)    No Interest Period to Expire After Maturity Date. Notwithstanding any other provision of this Agreement, Borrower shall not be entitled to request, or to elect to convert or continue, any Advance if the Interest Period requested with respect thereto would end after the Maturity Date.

3.02    Requests for Advances.

To request an Advance, Borrower shall notify Administrative Agent of such request by electronic communication as provided in Section 11.01, (a) in the case of a Eurodollar Advance, not later than 11:00 a.m., Dallas, Texas time, three (3) Business Days before the date of the proposed Advance or (b) in the case of a Floating Rate Advance, not later than 11:00 a.m., Dallas, Texas time, one (1) Business Day before the date of the proposed Advance. Each such Borrowing Request shall be irrevocable, shall be in a form approved by Administrative Agent and shall specify the following information in compliance with Section 3.01 hereof:

(i)    the aggregate amount of the requested Advance;

(ii)    the requested Borrowing Date of such Advance, which shall be a Business Day;

(iii)    the Type of Advance requested; i.e., a Floating Rate Advance or a Eurodollar Advance; and

(iv)    in the case of a Eurodollar Advance, the initial Interest Period to be applicable thereto, which shall be a period contemplated by the definition of the term “Interest Period”.

If no election as to the Type of Advance is specified, then the requested Advance shall be a Eurodollar Advance. If no Interest Period is specified with respect to any requested Eurodollar Advance, then Borrower shall be deemed to have requested a Eurodollar Advance with an Interest Period of one month. Promptly following receipt of a Borrowing Request in accordance with this Section, Administrative Agent shall advise each Lender of the details thereof and of the amount of such Lender’s Loan to be made as part of the requested Advance.

3.03    Funding of Advances.

(a)    Generally. Each Lender shall make each Loan to be made by it hereunder on the proposed date thereof by wire transfer of immediately available funds by 11:00 a.m., Dallas, Texas time, to the account of Administrative Agent most recently designated by it for such purpose by notice to the Lenders. Administrative Agent will make such Loans available to Borrower on the Borrowing Date by crediting the amounts so received, in like funds, to an account of Borrower maintained with Administrative Agent and designated by Borrower in Administrative Agent’s Borrower Administrative Questionnaire.

(b)    Advance Fundings. Unless Administrative Agent shall have received notice from a Lender prior to the proposed date of the Advance that such Lender will not make available to Administrative Agent such Lender’s share of the Advance, Administrative Agent may assume that such Lender has made such share available on such date in accordance with paragraph (a) of this Section and may, in reliance upon such assumption, make available to Borrower a corresponding amount. In such event, if a Lender has not in fact made its share of the Advance available to Administrative Agent, then the applicable Lender and Borrower severally agree to pay to Administrative Agent forthwith on demand such corresponding amount with interest thereon, for each day from and including the date such amount is made available to Borrower to but excluding the date of payment to Administrative Agent, at (i) in the case of such Lender, the greater of the Federal Funds Effective Rate and a rate determined by Administrative Agent in accordance with banking industry rules on interbank compensation or (ii) in the case of Borrower, the interest rate applicable to Floating Rate Loans. If such Lender pays such amount to Administrative Agent, then such amount shall constitute such Lender’s Loan included in the Advance.

3.04    Interest Elections.

(a)    Generally. The Advance initially shall be of the Type specified in the applicable Borrowing Request and, in the case of a Eurodollar Advance, shall have an initial Interest Period as specified in such

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Borrowing Request. Thereafter, Borrower may elect to convert such Advance to a different Type or to continue such Advance and, in the case of a Eurodollar Advance, may elect Interest Periods therefor, all as provided in this Section. Borrower may elect different options with respect to different portions of the affected Advance, in which case each such portion shall be allocated ratably among the Lenders holding the Loans comprising such Advance, and the Loans comprising each such portion shall be considered a separate Advance.

(b)    Interest Election Request. To make an election pursuant to this Section, Borrower shall notify Administrative Agent of such election by electronic communication as provided in Section 11.01 by the time that a Borrowing Request would be required under Section 3.02 hereof if Borrower were requesting an Advance of the Type resulting from such election to be made on the effective date of such election. Each such Interest Election Request shall be irrevocable and shall be in a form approved by Administrative Agent.

(c)    Required Information. Each Interest Election Request shall specify the following information in compliance with Section 3.01 hereof:

(i)    the Advance to which such Interest Election Request applies and, if different options are being elected with respect to different portions thereof, the portions thereof to be allocated to each resulting Advance (in which case the information to be specified pursuant to clauses (iii) and (iv) below shall be specified for each resulting Advance);

(ii)    the effective date of the election made pursuant to such Interest Election Request, which shall be a Business Day;

(iii)    the Type of Advance, i.e., a Floating Rate Advance or a Eurodollar Advance; and

(iv)    if the resulting Advance is a Eurodollar Advance, the Interest Period to be applicable thereto after giving effect to such election, which shall be a period contemplated by the definition of the term “Interest Period”.

If no Type of Advance is specified in the Interest Election Request, or if any such Interest Election Request requests a Eurodollar Advance but does not specify an Interest Period, then Borrower shall be deemed to have requested a Eurodollar Advance with an Interest Period of one month.

(d)    Notice to Lenders. Promptly following receipt of an Interest Election Request, Administrative Agent shall advise each Lender of the details thereof and of such Lender’s portion of each resulting Advance.

(e)    Failure to Elect; Default. If Borrower fails to deliver a timely Interest Election Request with respect to a Eurodollar Advance prior to the end of the Interest Period applicable thereto, then such Advance shall continue as a Eurodollar Advance until the end of the next Interest Period. Notwithstanding any contrary provision hereof, so long as a Default has occurred and is continuing, (i) no outstanding Advance may be converted to or continued as a Eurodollar Advance and (ii) unless repaid, each Eurodollar Advance shall be converted to a Floating Rate Advance at the end of the Interest Period applicable thereto.

3.05    Repayment of Loans; Evidence of Debt.

(a)    Repayment at Maturity. Borrower hereby unconditionally promises to pay to Administrative Agent for the account of each Lender the then unpaid principal amount of each Loan and all unpaid accrued interest on the Maturity Date.

(b)    Lender Accounting. Each Lender shall maintain in accordance with its usual practice an accounting of the indebtedness of Borrower to such Lender resulting from each Loan made by such Lender, including the amounts of principal and interest payable and paid to such Lender from time to time hereunder.

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(c)    Administrative Agent Accounting. Administrative Agent shall maintain an accounting of (i) the amount of each Loan made hereunder, the Type thereof and the Interest Period applicable thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from Borrower to each Lender hereunder and (iii) the amount of any sum received by Administrative Agent hereunder for the account of the Lenders and each Lender’s share thereof.

(d)    Prima Facie Evidence. The entries made in the accounting maintained pursuant to paragraph (b) or (c) of this Section shall be prima facie evidence of the existence and amounts of the obligations recorded therein; provided that the failure of any Lender or Administrative Agent to maintain such accounting or any error therein shall not in any manner affect the obligation of Borrower to repay the Loans in accordance with the terms of this Agreement.

(e)    Notes. The Loan made by each Lender shall be evidenced by the Note executed by Borrower in favor of such Lender.

3.06    Prepayment of Loans.

Borrower shall have the right at any time and from time to time to prepay any Advance in whole or in part, subject to prior notice in accordance with this Section 3.06. Borrower shall notify Administrative Agent by electronic communication as provided in Section 11.01 of any prepayment hereunder (i) in the case of prepayment of a Eurodollar Advance, not later than 11:00 a.m., Dallas, Texas time, three (3) Business Days before the date of prepayment, or (ii) in the case of prepayment of a Floating Rate Advance, not later than 11:00 a.m., Dallas, Texas time, one (1) Business Day before the date of prepayment. Each such notice shall be irrevocable and shall specify the prepayment date and the principal amount of each Advance or portion thereof to be prepaid. Promptly following receipt of any such notice, Administrative Agent shall advise the Lenders of the contents thereof. Each partial prepayment of any Advance shall be in an amount that would be permitted in the case of an Advance of the same Type as provided in Section 3.01 hereof. Prepayments shall be accompanied by accrued interest on the amount prepaid, plus any other break funding payments or fees required by Section 3.11 or other amounts required by Section 3.08 hereof.

3.07    Fees.

(a)    Loan Fee. Borrower agrees to pay to Administrative Agent for the account of each Lender a loan fee payable in the amount and at the time separately agreed upon between Borrower and Administrative Agent.

(b)    Administrative Agent Fee. Borrower agrees to pay to Administrative Agent, for its own account, fees payable in the amounts and at the times separately agreed upon between Borrower and Administrative Agent.

(c)    Undrawn Fee. From the Closing Date until the last day of the Availability Period, Borrower agrees to pay to the Administrative Agent, for the account of each Lender, an undrawn fee (the “Undrawn Fee”), computed at the Undrawn Fee Rate on the average daily amount of the Available Commitment of such Lender during the period for which payment is made, payable quarterly in arrears on each last day of each March, June, September and December of each year and on the date on which the Commitments terminate, commencing on the first such date to occur after the Closing Date; provided that any Undrawn Fee accruing after the termination of the Commitments shall be payable on demand. The Undrawn Fee shall be computed on the basis of a year of 365 days and shall be payable for the actual number of days elapsed (including the first day but excluding the last day). Administrative Agent shall endeavor to deliver to Borrower fifteen (15) days prior to each Undrawn Fee due date a statement setting forth the Undrawn Fee and the computation.

(d)    Fees Non-Refundable. All fees payable hereunder shall be paid on the dates due, in dollars in immediately available funds, to Administrative Agent for distribution, in the case of the Loan Fee, to the Lenders. Fees paid shall not be refundable under any circumstances absent manifest error.

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3.08    Interest.

(a)    Floating Rate Loans. The Loans comprising each Floating Rate Advance shall bear interest at the Floating Rate.

(b)    Eurodollar Loans. The Loans comprising each Eurodollar Advance shall bear interest at the Eurodollar Rate for the Interest Period in effect for such Advance.

(c)    Default Rate. Notwithstanding the foregoing, to the extent permitted under applicable law, upon the occurrence and during the continuance of a Default, and after maturity, the Loans shall bear interest, after as well as before judgment, at a rate per annum equal to 5% plus the rate otherwise applicable to such Loans as provided in the preceding paragraphs of this Section.

(d)    Payment of Accrued Interest. Accrued interest on each Loan shall be payable in arrears on each Interest Payment Date for such Loan; provided that (i) interest accrued pursuant to paragraph (c) of this Section shall be payable on demand, (ii) in the event of any repayment or prepayment of any Loan, accrued interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment and (iii) in the event of any conversion of any Eurodollar Loan prior to the end of the current Interest Period therefor, accrued interest on such Loan shall be payable on the effective date of such conversion.

(e)    Computation of Interest. All interest hereunder shall be computed on the basis of a year of 365 days, and shall be payable for the actual number of days elapsed (including the first day but excluding the last day). The applicable Alternate Base Rate, Adjusted LIBO Rate or LIBO Rate shall be determined by Administrative Agent, and such determination shall be conclusive absent manifest error.

3.09    Alternate Rate of Interest.

(a)    If prior to the commencement of any Interest Period for a Eurodollar Advance:

(i)    Administrative Agent determines (which determination shall be conclusive and binding absent manifest error) that adequate and reasonable means do not exist for ascertaining the Adjusted LIBO Rate or the LIBO Rate, as applicable (including by means of an Interpolated Rate or because the LIBO Screen Rate is not available or published on a current basis), for such Interest Period; provided that no Benchmark Transition Event shall have occurred at such time; or

(ii)    Administrative Agent is advised by the Required Lenders that the Adjusted LIBO Rate or the LIBO Rate, as applicable, for such Interest Period will not adequately and fairly reflect the cost to such Lenders (or Lender) of making or maintaining their Loans (or its Loan) included in such Advance for such Interest Period,

then Administrative Agent shall give notice thereof to Borrower and the Lenders by electronic communication as provided in Section 11.01 as promptly as practicable thereafter and, until Administrative Agent notifies Borrower and the Lenders that the circumstances giving rise to such notice no longer exist, (A) any Interest Election Request that requests the conversion of any Advance to, or continuation of any Advance as, a Eurodollar Advance shall be ineffective, and (B) if any Borrowing Request requests a Eurodollar Advance, such Advance shall be made as a Floating Rate Advance.

(b)    Notwithstanding anything to the contrary herein or in any other Loan Document, upon the occurrence of a Benchmark Transition Event or an Early Opt-in Election, as applicable, Administrative Agent and Borrower may amend this Agreement to replace the LIBO Rate with a Benchmark Replacement. Any such amendment with respect to a Benchmark Transition Event will become effective at 5:00 p.m. on the fifth (5^th) Business Day after Administrative Agent has posted such proposed amendment to all Lenders and Borrower, so long as Administrative Agent has not received, by such time, written notice of objection to such proposed amendment from Lenders comprising the Required Lenders; provided that, with respect to any proposed amendment containing any SOFR-Based Rate, the Lenders shall be entitled to object only to the Benchmark Replacement Adjustment contained therein.

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Any such amendment with respect to an Early Opt-in Election will become effective on the date that Lenders comprising the Required Lenders have delivered to Administrative Agent written notice that such Required Lenders accept such amendment. No replacement of LIBO Rate with a Benchmark Replacement will occur prior to the applicable Benchmark Transition Start Date.

(c)    In connection with the implementation of a Benchmark Replacement, Administrative Agent will have the right to make Benchmark Replacement Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Loan Document, any amendments implementing such Benchmark Replacement Conforming Changes will become effective without any further action or consent of any other party to this Agreement.

(d)    Administrative Agent will promptly notify Borrower and the Lenders of (i) any occurrence of a Benchmark Transition Event or an Early Opt-in Election, as applicable, (ii) the implementation of any Benchmark Replacement, (iii) the effectiveness of any Benchmark Replacement Conforming Changes and (iv) the commencement or conclusion of any Benchmark Unavailability Period. Any determination, decision or election that may be made by Administrative Agent or Lenders pursuant to this Section 3.09, including any determination with respect to a tenor, rate or adjustment or of the occurrence or non-occurrence of an event, circumstance or date and any decision to take or refrain from taking any action, will be conclusive and binding absent manifest error and may be made in its or their sole discretion and without consent from any other party hereto, except, in each case, as expressly required pursuant to this Section 3.09.

(e)    Upon Borrower’s receipt of notice of the commencement of a Benchmark Unavailability Period, (i) any Interest Election Request that requests the conversion of any Advance to, or continuation of any Advance as, a Eurodollar Advance shall be ineffective, and (ii) if any Borrowing Request requests a Eurodollar Advance, such Advance shall be made as a Floating Rate Advance.

3.10    Increased Costs.

(a)    Increased Costs of Making or Maintaining Loans. If any Change in Law shall (i) impose, modify or deem applicable any reserve, special deposit or similar requirement (including any compulsory loan requirement, insurance charge or other assessment) against assets of, deposits with or for the account of, or credit extended by any Lender (except any such reserve requirement reflected in the Adjusted LIBO Rate), (ii) impose on any Lender or the London interbank market any other condition, cost or expense (other than Taxes) affecting this Agreement or the Loans made by such Lender or (iii) subject any Recipient to any Taxes (other than (A) Indemnified Taxes, (B) Taxes described in clauses (b) through (d) of the definition of Excluded Taxes and (C) Connection Income Taxes) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto, and the result of any of the foregoing shall be to increase the cost to such Lender or such other Recipient of making, continuing, converting into or maintaining any Loan (or of maintaining its obligation to make any such Loan) or to reduce the amount of any sum received or receivable by such Lender or such other Recipient hereunder (whether of principal, interest or otherwise), then Borrower will pay to such Lender or such other Recipient such additional amount or amounts as will compensate such Lender or such other Recipient for such additional costs incurred or reduction suffered.

(b)    Capital Adequacy. If any Lender determines that any Change in Law regarding capital or liquidity requirements has or would have the effect of reducing the rate of return on such Lender’s capital or on the capital of such Lender’s holding company, if any, as a consequence of this Agreement or the Loans made by such Lender to a level below that which such Lender or such Lender’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s policies and the policies of such Lender’s holding company with respect to capital adequacy and liquidity), then from time to time Borrower will pay to such Lender such additional amount or amounts as will compensate such Lender or such Lender’s holding company for any such reduction suffered. Notwithstanding anything to the contrary contained herein, so long as JPMorgan is then the only Lender, then Administrative Agent and Lenders agree that this Section 3.10(b) shall not apply and be of no force or effect.

(c)    Certificate of Amounts Due. A certificate of a Lender setting forth the amount or amounts necessary to compensate such Lender or its holding company, as the case may be, as specified in paragraph (a) or (b) of this Section shall be delivered to Borrower and shall be conclusive absent manifest error. Borrower shall pay such Lender the amount shown as due on any such certificate within ten (10) days after receipt thereof.

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(d)    Delay in Demand For Compensation. Failure or delay on the part of any Lender to demand compensation pursuant to this Section shall not constitute a waiver of such Lender’s right to demand such compensation; provided that Borrower shall not be required to compensate a Lender pursuant to this Section for any increased costs or reductions incurred more than 180 days prior to the date that such Lender notifies Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender’s intention to claim compensation therefor; provided further that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the 180-day period referred to above shall be extended to include the period of retroactive effect thereof. Notwithstanding anything to the contrary contained herein, so long as JPMorgan is then the only Lender, then Administrative Agent and Lenders agree that this Section 3.10(d) shall not apply and be of no force or effect.

3.11    Break Funding Payments.

In the event of (a) the payment of any principal of any Eurodollar Loan other than on the last day of an Interest Period applicable thereto (including as a result of a Default), (b) the conversion of any Eurodollar Loan other than on the last day of the Interest Period applicable thereto, (c) the failure to borrow, convert, continue or prepay any Eurodollar Loan on the date specified in any notice delivered pursuant hereto, or (d) the assignment of any Eurodollar Loan other than on the last day of the Interest Period applicable thereto as a result of a request by Borrower pursuant to Section 3.14 hereof, then, in any such event, Borrower shall pay to Administrative Agent an administrative fee of $250.00 and compensate each Lender for the loss, cost and expense attributable to such event. Such loss, cost or expense to any Lender shall be deemed to include an amount determined by such Lender to be the excess, if any, of (i) the amount of interest which would have accrued on the principal amount of such Eurodollar Loan had such event not occurred, at the Adjusted LIBO Rate that would have been applicable to such Eurodollar Loan, for the period from the date of such event to the last day of the then current Interest Period therefor (or, in the case of a failure to borrow, convert or continue, for the period that would have been the Interest Period for such Eurodollar Loan), over (ii) the amount of interest which would accrue on such principal amount for such period at the interest rate which such Lender would bid were it to bid, at the commencement of such period, for dollar deposits of a comparable amount and period from other banks in the Eurodollar market. A certificate of any Lender setting forth any amount or amounts that such Lender is entitled to receive pursuant to this Section shall be delivered to Borrower and shall be conclusive absent manifest error. Borrower shall pay such Lender the amount shown as due on any such certificate within ten (10) days after receipt thereof; provided, however, in the event the total fees under this Section 3.11 for a single event are less than $1,000 and JPMorgan is then the only Lender, then Administrative Agent and Lenders agree to waive such fees.

3.12    Withholding of Taxes; Gross Up.

(a)    Payments Free of Taxes. Any and all payments by or on account of any obligation of Borrower under any Loan Document shall be made without deduction or withholding for any Taxes, except as required by applicable law. If any applicable law (as determined in the good faith discretion of an applicable withholding agent) requires the deduction or withholding of any Tax from any such payment by a withholding agent, then the applicable withholding agent shall be entitled to make such deduction or withholding and shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable law and, if such Tax is an Indemnified Tax, then the sum payable by Borrower shall be increased as necessary so that after such deduction or withholding has been made (including such deductions and withholdings applicable to additional sums payable under this Section 3.12), the applicable Recipient receives an amount equal to the sum it would have received had no such deduction or withholding been made.

(b)    Payment of Other Taxes by Borrower. Borrower shall timely pay to the relevant Governmental Authority in accordance with applicable law Other Taxes, and if not timely paid by Borrower, Administrative Agent may pay any past due amounts for Other Taxes, and Borrower shall reimburse Administrative Agent for such amounts within ten (10) days after written notice from Administrative Agent.

(c)    Evidence of Payments. As soon as practicable after any payment of Taxes by Borrower to a Governmental Authority pursuant to this Section 3.12, Borrower shall deliver to Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to Administrative Agent.

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(d)    Indemnification by Borrower. Borrower shall indemnify each Recipient, within 10 days after demand therefor, for the full amount of any Indemnified Taxes (including Taxes imposed or asserted on or attributable to amounts payable under this Section) payable or paid by such Recipient or required to be withheld or deducted from a payment to such Recipient and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to Borrower by a Lender (with a copy to Administrative Agent), or by Administrative Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error.

(e)    Indemnification by the Lenders. Each Lender shall severally indemnify Administrative Agent, within 10 days after demand therefor, for (i) any Indemnified Taxes attributable to such Lender (but only to the extent that Borrower has not already indemnified Administrative Agent for such Indemnified Taxes and without limiting the obligation of Borrower to do so), (ii) any Taxes attributable to such Lender’s failure to comply with the provisions of Section 11.04(c)(i) relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each case, that are payable or paid by Administrative Agent in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by Administrative Agent shall be conclusive absent manifest error. Each Lender hereby authorizes Administrative Agent to setoff and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by Administrative Agent to the Lender from any other source against any amount due to Administrative Agent under this paragraph (e).

(f)    Status of Lenders. (i) Any Lender that is entitled to an exemption from or reduction of withholding Tax with respect to payments made under any Loan Document shall deliver to Borrower and Administrative Agent, at the time or times reasonably requested by Borrower or Administrative Agent, such properly completed and executed documentation reasonably requested by Borrower or Administrative Agent as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition, any Lender, if reasonably requested by Borrower or Administrative Agent, shall deliver such other documentation prescribed by applicable law or reasonably requested by Borrower or Administrative Agent as will enable Borrower or Administrative Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements. Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in Section 3.12(f)(ii)(A), (ii)(B) and (ii)(D) below) shall not be required if in the Lender’s reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender.

(i)    Without limiting the generality of the foregoing, in the event that Borrower is a U.S. Person,

(A)    any Lender that is a U.S. Person shall deliver to Borrower and Administrative Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of Borrower or Administrative Agent), an executed copy of IRS Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding tax;

(B)    any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to Borrower and Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of Borrower or Administrative Agent), whichever of the following is applicable:

(1)    in the case of a Foreign Lender claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under

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any Loan Document, an executed copy of IRS Form W-8BEN-E or IRS Form W-8BEN establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “interest” article of such tax treaty and (y) with respect to any other applicable payments under any Loan Document, IRS Form W-8BEN-E or IRS Form W-8BEN establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;

(2)    in the case of a Foreign Lender claiming that its extension of credit will generate U.S. effectively connected income, an executed copy of IRS Form W-8ECI;

(3)    in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate substantially in the form of Exhibit F-1 to the effect that such Foreign Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10 percent shareholder” of Borrower within the meaning of Section 881(c)(3)(B) of the Code, or a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code (a “U.S. Tax Compliance Certificate”) and (y) an executed copy of IRS Form W-8BENE or IRS Form W-8BEN; or

(4)    to the extent a Foreign Lender is not the beneficial owner, an executed copy of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN-E, IRS Form W-8BEN, a U.S. Tax Compliance Certificate substantially in the form of Exhibit F-2 or Exhibit F-3, IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that if the Foreign Lender is a partnership and one or more direct or indirect partners of such Foreign Lender are claiming the portfolio interest exemption, such Foreign Lender may provide a U.S. Tax Compliance Certificate substantially in the form of Exhibit F-4 on behalf of each such direct and indirect partner;

(C)    any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to Borrower and Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of Borrower or Administrative Agent), executed copies of any other form prescribed by applicable law as a basis for claiming exemption from or a reduction in U.S. federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by applicable law to permit Borrower or Administrative Agent to determine the withholding or deduction required to be made; and

(D)    if a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to Borrower and Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by Borrower or Administrative Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by Borrower or Administrative Agent as may be necessary for Borrower and Administrative Agent to comply with their obligations under FATCA and to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (D), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.

Each Lender agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify Borrower and Administrative Agent in writing of its legal inability to do so.

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(g)    Treatment of Certain Refunds. If any party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section 3.12 (including by the payment of additional amounts pursuant to this Section 3.12), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under this Section 3.12 with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including Taxes) of such indemnified party and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund). Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party the amount paid over pursuant to this paragraph (g) (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event that such indemnified party is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this paragraph (g), in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this paragraph (g) the payment of which would place the indemnified party in a less favorable net after-Tax position than the indemnified party would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such Tax had never been paid. This paragraph shall not be construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the indemnifying party or any other Person.

(h)    Survival; Defined Terms. Each party’s obligations under this Section 3.12 shall survive the resignation or replacement of Administrative Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all obligations under any Loan Document. For purposes of this Section 3.12, the term “applicable law” includes FATCA.

3.13    Payments Generally; Pro Rata Treatment; Sharing of Setoffs.

(a)    Payments Generally. Borrower shall make each payment or prepayment required to be made by it hereunder (whether of principal, interest or fees, or of amounts payable under Section 3.10, 3.11 or 3.12, or otherwise) prior to 11:00 a.m., Dallas, Texas time, on the date when due or the date fixed for prepayment hereunder, in immediately available funds, without setoff, recoupment or counterclaim. Any amounts received after such time on any date may, in the discretion of Administrative Agent be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon. All such payments shall be made to Administrative Agent at its offices at 700 North Pearl Street, Floor 13, Dallas, Texas 75201-7424 except that payments pursuant to Sections 3.10, 3.11, 3.12 and 11.03 hereof shall be made directly to the Persons entitled thereto. Administrative Agent shall distribute any such payments received by it for the account of any other Person to the appropriate recipient promptly following receipt thereof. If any payment hereunder shall be due on a day that is not a Business Day, the date for payment shall be extended to the next succeeding Business Day, and, in the case of any payment accruing interest, interest thereon shall be payable for the period of such extension. All payments hereunder shall be made in U.S. dollars.

(b)    Application of Proceeds. Any proceeds of collateral received by Administrative Agent (x) not constituting either (A) a specific payment of principal, interest, fees or other sum payable under the Loan Documents (which shall be applied as specified by Borrower unless a Default or Unmatured Default has occurred and is continuing), or (B) a mandatory prepayment (which shall be applied in accordance with the applicable provision) or (y) after a Default or Unmatured Default has occurred and is continuing, shall be applied by Administrative Agent as follows: (i) first, towards payment of fees, indemnities and expense reimbursements then due hereunder to the parties entitled thereto; (ii) second, towards payment of interest then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of interest then due to such parties, and (iii) third, towards payment of principal then due hereunder and Swap Obligations then due on a pari passu basis, ratably among the parties entitled thereto in accordance with the amounts of principal and Swap Obligations then due to such parties. Notwithstanding the foregoing, amounts received from any Guarantor that is not an “eligible contract participant” as defined in the Commodity Exchange Act or any rule, regulation, or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) shall not be applied to the Obligations.

(c)    Allocation of Payments. If, except as otherwise expressly provided herein, any Lender shall, by exercising any right of setoff or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of its Loans resulting in such Lender receiving payment of a greater proportion of the aggregate amount

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of its Loans and accrued interest thereon than the proportion received by any other similarly situated Lender, then the Lender receiving such greater proportion shall purchase (for cash at face value) participations in the Loans of other Lenders to the extent necessary so that the benefit of all such payments shall be shared by all such Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Loans; provided that (i) if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest, and (ii) the provisions of this paragraph shall not be construed to apply to any payment made by Borrower pursuant to and in accordance with the express terms of this Agreement or any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans to any assignee or participant, other than to Borrower or any subsidiary or Affiliate thereof (as to which the provisions of this paragraph shall apply). Borrower consents to the foregoing and agrees, to the extent it may effectively do so under applicable law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against Borrower rights of setoff and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of Borrower in the amount of such participation.

(d)    Advance Payments. Unless Administrative Agent shall have received, prior to any date on which any payment is due to Administrative Agent for the account of the Lenders hereunder pursuant to the terms hereof or any other Loan Document (including any date that is fixed for prepayment by notice from Borrower to Administrative Agent pursuant to Section 3.06) notice from Borrower that Borrower will not make such payment or prepayment, Administrative Agent may assume that Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders the amount due. In such event, if Borrower has not in fact made such payment, then each of the Lenders severally agrees to repay to Administrative Agent forthwith on demand the amount so distributed to such Lender with interest thereon, for each day from and including the date such amount is distributed to it but excluding the date of payment to Administrative Agent, at the greater of the NYFRB Rate and a rate determined by Administrative Agent in accordance with banking industry rules on interbank compensation.

3.14    Mitigation Obligations; Replacement of Lenders.

(a)    Mitigation of Increased Costs. If any Lender requests compensation under Section 3.10 hereof, or if Borrower is required to pay any Indemnified Taxes or additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.12 hereof, then such Lender shall use reasonable efforts to designate a different lending office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 3.10 or 3.12 hereof, as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.

(b)    Replacement of Lenders. If any Lender requests compensation under Section 3.10 hereof, or if Borrower is required to pay any Indemnified Taxes or additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.12 hereof, or if any Lender becomes a Defaulting Lender, then Borrower may, at its sole expense and effort, upon notice to such Lender and Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in Section 11.04 hereof), all its interests, rights (other than its existing rights to payments pursuant to Section 3.10 or 3.12) and obligations under this Agreement and the other Loan Documents to an assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that (i) Borrower shall have received the prior written consent of Administrative Agent, (ii) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans, accrued interest thereon, accrued fees and all other amounts payable to it hereunder, from the assignee (to the extent of such outstanding principal and accrued interest and fees) or Borrower (in the case of all other amounts); provided however, that in the case of Borrower’s replacement of a Defaulting Lender for failure to fund Loans hereunder, the assignee or Borrower, as the case may be, shall holdback from such amounts payable to such Lender and pay directly to Administrative Agent, any payments due to Administrative Agent or the Non-Defaulting Lenders by Defaulting Lender under this Agreement, and (iii) in the case of any such assignment resulting from a claim for compensation under Section 3.10 hereof or payments required to be made pursuant to Section 3.12 hereof, such assignment will result in a reduction in such compensation

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or payments. A Lender shall not be required to make any such assignment and delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling Borrower to require such assignment and delegation cease to apply. Each party hereto agrees that (i) an assignment required pursuant to this paragraph may be effected pursuant to an Assignment and Assumption executed by Borrower, Administrative Agent and the assignee (or, to the extent applicable, an agreement incorporating an Assignment and Assumption by reference pursuant to an Approved Electronic Platform as to which Administrative Agent and such parties are participants), and (ii) the Lender required to make such assignment need not be a party thereto in order for such assignment to be effective and shall be deemed to have consented to and be bound by the terms thereof; provided that, following the effectiveness of any such assignment, the other parties to such assignment agree to execute and deliver such documents necessary to evidence such assignment as reasonably requested by the applicable Lender, provided that any such documents shall be without recourse to or warranty by the parties thereto.

3.15    Extension Options.

(a)    First Extension Option. At the written request of Borrower made at least sixty (60) days but not more than one hundred twenty (120) days prior to the Initial Maturity Date, the Maturity Date shall be extended to the one-year anniversary of the Initial Maturity Date (the “First Extended Maturity Date”) provided that the following conditions are satisfied:

(i)    Administrative Agent shall have received evidence indicating whether the Improvements or any part thereof are or will be located within a one hundred year flood plain or other area identified by Administrative Agent as having high or moderate risk of flooding or identified as a special flood hazard area as defined by FEMA, and, if so, a flood notification form signed by Borrower and evidence that the flood insurance required by Article VII of this Agreement is in place for the Improvements and contents, if applicable, all in form, substance and amount satisfactory to Administrative Agent;

(ii)    Intentionally Omitted;

(iii)    Borrower has demonstrated to the satisfaction of Administrative Agent that, as of the Initial Maturity Date, the Debt Service Coverage Ratio is not less than 1.20:1.00;

(iv)    Borrower has delivered to Administrative Agent, evidence acceptable to Administrative Agent (which evidence shall be a new Appraisal timely obtained by Administrative Agent) that, as of the Initial Maturity Date, the Loan-to-Value Ratio does not exceed 65.0%;

(v)    On or before the Initial Maturity Date, Administrative Agent shall have received, on behalf of the Lenders, an extension fee in an amount equal to 0.125% of the Aggregate Commitment;

(vi)    No Default or Unmatured Default shall have occurred and be continuing on the Initial Maturity Date;

(vii)    All representations and warranties made hereunder or under any of the other Loan Documents shall be true and correct in all material respects as of the Initial Maturity Date, except to the extent such representation and warranty is made as of a specified date, in which case such representation and warranty shall have been true and correct as of such specified date;

(viii)    Administrative Agent has received satisfactory documentation evidencing the extension executed by Borrower and consented to by Guarantor, and Borrower shall have paid all of Administrative Agent’s costs and expenses in connection with such extension in accordance with Section 11.03; and

(ix)    Intentionally Omitted.

(b)    Second Extension Option. At the written request of Borrower made at least sixty (60) days but not more than one hundred twenty (120) days prior to the First Extended Maturity Date, the Maturity Date shall

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be further extended to the one-year anniversary of the First Extended Maturity Date, provided that the following conditions are satisfied:

(i)    The Maturity Date has previously been extended to the First Extended Maturity Date pursuant to the provisions of Section 3.15(a) hereof;

(ii)    Administrative Agent shall have received evidence indicating whether the Improvements or any part thereof are or will be located within a one hundred year flood plain or other area identified by Administrative Agent as having high or moderate risk of flooding or identified as a special flood hazard area as defined by FEMA, and, if so, a flood notification form signed by Borrower and evidence that the flood insurance required by Article VII of this Agreement is in place for the Improvements and contents, if applicable, all in form, substance and amount satisfactory to Administrative Agent;

(iii)    Intentionally Omitted;

(iv)    Borrower has demonstrated to the satisfaction of Administrative Agent that, as of the First Extended Maturity Date, the Debt Service Coverage Ratio is not less than 1.20:1.00;

(v)    Intentionally Omitted;

(vi)    On or before the First Extended Maturity Date, Administrative Agent shall have received, on behalf of the Lenders, an extension fee in an amount equal to 0.125% of the Aggregate Commitment;

(vii)    No Default or Unmatured Default shall have occurred and be continuing on the First Extended Maturity Date;

(viii)    All representations and warranties made hereunder or under any of the other Loan Documents shall be true and correct in all material respects as of the First Extended Maturity Date, except to the extent such representation and warranty is made as of a specified date, in which case such representation and warranty shall have been true and correct as of such specified date; and

(ix)    Administrative Agent has received satisfactory documentation evidencing the extension executed by Borrower and consented to by the Guarantor, and Borrower shall have paid all of Administrative Agent’s costs and expenses in connection with such extension in accordance with Section 11.03; and

(x)    Intentionally Omitted.

3.16    Defaulting Lenders.

Notwithstanding any provision of this Agreement to the contrary, if a Lender becomes a Defaulting Lender, the following provisions shall apply for so long as such Lender is a Defaulting Lender;

(a)    Accrual of Fees. Fees shall cease to accrue on the unfunded portion of the Commitment of such Defaulting Lender pursuant to Section 3.07(c).

(b)    Suspension of Voting Rights. Such Defaulting Lender shall not have the right to vote on any issue on which voting is required (other than to the extent expressly provided in Section 11.02(b)) and the Commitment of such Defaulting Lender shall not be included in determining whether the Required Lenders have taken or may take any action hereunder or under any other Loan Document.

(c)    Turn Over of Payments. Any payment of principal, interest, fees or other amounts received by Administrative Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Section 3.13(b) or otherwise) or received by Administrative Agent from a Defaulting Lender pursuant to

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Section 11.08 shall be applied at such time or times as may be determined by Administrative Agent as: (i) first, to the payment of any amounts owing by the Defaulting Lender to Administrative Agent hereunder, (ii) second, as Borrower may request (so long as no Default exists), to the funding of any Advance in respect of which the Defaulting Lender has failed to fund its portion as required by this Agreement, as determined by Administrative Agent, (iii) third, to the payment of any amounts owing by the Defaulting Lender to the Non-Defaulting Lenders hereunder, including without limitation for any Special Advance under paragraph (d) of this Section 3.16, (iv) fourth, if so determined by Administrative Agent and Borrower, held in a deposit account as cash collateral for future funding obligations of the Defaulting Lender under this Agreement, (v) fifth, to the payment of any amounts owing to the Lenders as a result of any judgment of a court of competent jurisdiction obtained by any Lender against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement or under any other Loan Document, (vi) sixth, so long as no Default exists, to the payment of any amounts owing to Borrower as a result of any judgment of a court of competent jurisdiction obtained by Borrower against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement or under any other Loan Document, and (vii) seventh, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if such payment is a prepayment of the principal amount of any Loans, such payment shall be applied solely to pay the Loans of all Non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of such Defaulting Lender. Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender or to post cash collateral pursuant to this clause shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.

(d)    Special Advances. If a Lender fails to fund its portion of any Advance, in whole or part, within three (3) Business Days after the date required hereunder and Administrative Agent shall not have funded the Defaulting Lender’s portion of the Advance under Section 3.03(b), Administrative Agent shall so notify the Lenders, and within three (3) Business Days after delivery of such notice, the Non-Defaulting Lenders shall have the right, but not the obligation, in their respective, sole and absolute discretion, to fund all or a portion of such deficiency (the amount so funded by any such Non-Defaulting Lenders being referred to herein as a “Special Advance”) to Borrower. In such event, the Defaulting Lender and Borrower severally agree to pay to Administrative Agent for payment to the Non-Defaulting Lenders making the Special Advance, forthwith on demand such amount with interest thereon, for each day from and including the date such amount is made available to Borrower to but excluding the date of payment to Administrative Agent, at (i) in the case of the Defaulting Lender, the greater of the NYFRB Rate and a rate determined by Administrative Agent in accordance with banking industry rules on interbank compensation or (ii) in the case of Borrower, the interest rate applicable to Floating Rate Loans.

(e)    Option to Purchase Future Commitment. The Non-Defaulting Lenders shall have the right, but not the obligation, in their respective, sole and absolute discretion, to acquire for no cash consideration (pro rata, based on the respective Commitments of those Lenders electing to exercise such right), Defaulting Lender’s Commitment to fund future Loans (the “Future Commitment”). Upon any such purchase of the Defaulting Lender’s Future Commitment, the Defaulting Lender’s share in future Advances and its rights under the Loan Documents and the Required Third Party Documents with respect thereto shall terminate on the date of purchase, and the Defaulting Lender shall promptly execute all documents reasonably requested to surrender and transfer such interest.

(f)    Replacement of Defaulting Lender.

(i)    By Required Lenders. Required Lenders may, upon notice to the Defaulting Lender and Administrative Agent, require the Defaulting Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in Section 11.04 hereof) all its interests, rights and obligations under this Agreement to an assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that (i) the Defaulting Lender shall have received payment of an amount equal to the outstanding principal of its Loans, accrued interest thereon, accrued fees and all other amounts payable to it hereunder from the assignee (to the extent of such outstanding principal and accrued interest and fees) or Borrower (in the case of all other amounts); and (ii) Administrative Agent shall have received payment of any amounts owing by such Lender to Administrative Agent or the other Lenders under this Agreement. The Defaulting Lender shall not be required to make any such assignment and delegation if, prior thereto, such Lender shall cease to be a Defaulting Lender.

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(ii)    By Borrower. If a Lender has become a Defaulting Lender due to a failure to fund its Loans hereunder, Borrower may, at its option, replace such Defaulting Lender under Section 3.14(b).

(g)    Indemnification. Each Defaulting Lender shall indemnify Administrative Agent, each Non-Defaulting Lender and Borrower from and against any liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind and nature whatever which may be imposed on, incurred by or asserted against Administrative Agent, any Non-Defaulting Lender or Borrower with respect to the Loan Documents or the Required Third Party Documents in any way relating to or arising out of such Lender’s status as a Defaulting Lender. The obligations of the Defaulting Lender under this clause (g) shall survive the payment of the Obligations, the termination of this Agreement and the Defaulting Lender’s reversion to a Non-Defaulting Lender under clause (h) of this Section 3.16.

(h)    Ceasing to be a Defaulting Lender. In the event that Administrative Agent and Borrower agree that a Defaulting Lender has adequately remedied all matters that caused such Lender to be a Defaulting Lender, then Aggregate Commitment of the Lenders shall be readjusted to reflect the inclusion of such Lender’s Commitment and on the date of such readjustment such Lender shall purchase at par such of the Loans of the other Lenders as Administrative Agent shall determine may be necessary in order for such Lender to hold such Loans in accordance with its Applicable Percentage.

3.17    Increase in Commitments.

(a)    Request for Increase. Provided there exists no Unmatured Default or Default, upon notice to Administrative Agent (which shall promptly notify the Lenders), Borrower may from time to time, request an increase in the Aggregate Commitment by an amount (for all such requests) not exceeding $57,400,000 to a total of $125,000,000 in aggregate Commitments); provided that any such request for an increase shall be in a minimum amount of $5,000,000 for any request with respect to the Mortgaged Property, and a minimum amount of $15,000,000 for any request with respect to any Potential Collateral, or such other amount as may be agreed upon by Borrower and Administrative Agent and Borrower shall not make more than three (3) such requests. At the time of sending such notice, Borrower (in consultation with Administrative Agent) shall specify the time period within which each Lender is requested to respond (which shall in no event be less than ten (10) Business Days from the date of delivery of such notice to the Lenders) as to whether it intends to seek approval for increasing its Commitment.

(b)    Lender Elections to Increase. Each Lender shall notify Administrative Agent within such time period whether or not it agrees to increase its Commitment and, if so, whether by an amount equal to, greater than, or less than its Applicable Percentage of such requested increase. Any Lender not responding within such time period shall be deemed to have declined to increase its Commitment.

(c)    Notification by Administrative Agent; Additional Lenders. Administrative Agent shall notify Borrower and each Lender of the Lenders’ responses to each request made hereunder. To achieve the full amount of a requested increase and subject to the approval of Administrative Agent and the Required Lenders, Borrower may also invite additional assignees that are not Ineligible Institutions to become Lenders pursuant to a joinder agreement in form and substance reasonably satisfactory to Administrative Agent and its counsel.

(d)    Effective Date and Allocations. If the aggregate Commitments are increased in accordance with this Section, Administrative Agent and Borrower shall determine the effective date (the “Increase Effective Date”) and the final allocation of such increase. Administrative Agent shall promptly notify Borrower and the Lenders of the final allocation of such increase and the Increase Effective Date

(e)     Conditions to Effectiveness of Increase. As a condition precedent to such increase, Borrower shall deliver to Administrative Agent: (i) certificates of Borrower and Guarantor dated as of the Increase Effective Date (in sufficient copies for each Lender) (x) approving or consenting to such increase (and attaching resolutions adopted by Borrower and Guarantor, as applicable, approving or consenting to such increase to the extent required under the respective organization documents), and (y) in the case of Borrower, certifying that, before and after giving effect to such increase, (A) the representations and warranties contained in Article VI and the other Loan Documents are true and correct in all material respects on and as of the Increase Effective Date, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they were true and correct

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as of such earlier date, and (B) no Unmatured Default or Default exists; (ii) an executed Compliance Certificate prepared using the financial statements of Borrower most recently provided or required to be provided and demonstrating pro-forma compliance with the financial covenants in Section 6.01 after giving to such increase; (iii) any legal opinions, resolutions or other documents reasonably requested by Administrative Agent in connection with such increase, consistent with the documents delivered on the Effective Date pursuant to Section 2.02(b); (iv) joinder or amendment agreements in form and substance satisfactory to, and executed by, Borrower, Guarantor, Administrative Agent and the Lenders providing such increase, which shall be binding on all Lenders; and (v) ratification agreements from Borrower and Guarantor with respect to the Guaranty and the Loan Documents as reasonably requested by Administrative Agent. Borrower shall prepay any Loans outstanding on the Increase Effective Date (and pay any additional amounts required pursuant to Section 2.16) to the extent necessary to keep the outstanding Loans ratable with any revised Applicable Percentages arising from any nonratable increase in the Commitments under this Section and shall pay all agreed-upon fees to the Lenders and shall pay all fees and expenses of Administrative Agent for which Borrower is responsible pursuant to Section 11.03.

3.18    Addition of Collateral Properties. Borrower shall have the right, subject to the consent of Administrative Agent and the Required Lenders and the satisfaction of the conditions set forth in this Section, to cause a Potential Co-Borrower to add Potential Collateral to the Collateral. In the event Borrower desires to add additional Potential Collateral as aforesaid, Borrower shall provide written notice to Administrative Agent of such request (which Administrative Agent shall promptly furnish to the Lenders). With respect to such Potential Collateral, Administrative Agent shall promptly furnish Required Lender BBP Deliverables to Lenders as they become available. The Lenders shall use good faith efforts to review each of the Required Lender BBP Deliverables within forty-five (45) days of receipt and to advise Borrower of the approval or rejection of such Potential Collateral by Administrative Agent or the Lenders, as applicable. Notwithstanding the foregoing, no Potential Collateral shall be included as Collateral unless and until the following conditions precedent shall have been satisfied:

(a)    the proposed Real Estate shall be Eligible Real Estate;

(b)    the direct owner of such Eligible Real Estate in connection with the inclusion of such Potential Collateral as Collateral hereunder and under the other Loan Documents (to the extent such direct owner or other Person is not already party to this Agreement and/or such other Loan Documents, as applicable) shall have executed a joinder agreement in form and substance reasonably satisfactory to Administrative Agent and its counsel;

(c)     Administrative Agent (on behalf of the Lenders) shall have received copies of the “Certificates of Insurance” in compliance with, and as more particularly described in, the schedule of Eligible Real Estate Qualification Documents;

(d)     Potential Co-Borrower shall have executed and/or delivered to Administrative Agent a Mortgage and all other Eligible Real Estate Qualification Documents, all of which instruments, documents or agreements shall be in form and substance reasonably satisfactory to Administrative Agent;

(e)     Borrower and Potential Co-Borrower shall have executed and delivered to Administrative Agent an executed compliance certificate prepared using the financial statements required to be provided to Administrative Agent under Section 4.09 adjusted in the best good faith estimate of Borrower solely to give effect to the proposed addition; and

(f)     after giving effect to the inclusion of such Potential Collateral in connection with each Borrowing Request, each of the representations and warranties made by or on behalf of Borrower contained in this Agreement, the other Loan Documents or in any document or instrument delivered pursuant to or in connection with this Agreement shall be true in all material respects both as of the date as of which it was made and shall also be true as of the time of the addition (or any replacement) of Collateral, with the same effect as if made at and as of that time (it being understood and agreed that any representation or warranty which by its terms is made as of a specified date shall be required to be true and correct only as of such specified date), except where the failure of any representation to be true and correct is not reasonably likely to have a material adverse effect and no Default shall have occurred and be continuing, and Administrative Agent shall have received a certificate of Borrower to such effect.

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Notwithstanding the foregoing, in the event such Potential Collateral does not qualify as Eligible Real Estate, such Potential Collateral shall nevertheless be included in the Collateral, so long as (x) the conditions set forth in clauses (b) through (e) of this Section have been satisfied, and (y) Administrative Agent shall have received the prior written approval by each of the Lenders of the inclusion of such Real Estate as in the Collateral.

Notwithstanding the foregoing, prior to Administrative Agent’s acceptance of a Mortgage for any new Potential Collateral, Administrative Agent agrees to promptly share with the Lenders copies of all documentation delivered by Borrower to demonstrate such property’s compliance with the requirements of the Flood Laws.

ARTICLE IV

GENERAL COVENANTS

4.01    Liens, Taxes, and Governmental Claims.

(a)    Liens. Borrower shall pay, satisfy and/or obtain the release of all other claims and Liens affecting or purporting to affect the title to, or which may be or appear to be Liens on, the Mortgaged Property or any part thereof (other than the Permitted Encumbrances), and all costs, charges, interest and penalties on account thereof, including without limitation the claims of all Persons supplying labor or materials to the Mortgaged Property, and to give Administrative Agent, upon demand, evidence satisfactory to Administrative Agent of the payment, satisfaction or release thereof. Notwithstanding the foregoing, nothing herein contained shall require Borrower to pay any claims or Liens which Borrower in good faith disputes and which Borrower, at its own expense, is currently and diligently contesting, provided that Borrower complies with the provisions of Section 4.01(c) hereof.

(b)    Taxes. Borrower agrees to pay or cause to be paid, prior to the date they would become delinquent if not paid, any and all taxes, assessments and governmental charges whatsoever levied upon or assessed or charged against the Mortgaged Property, including all water and sewer taxes, assessments and other charges, fines, impositions and rents, if any. If requested by Administrative Agent, Borrower shall give to Administrative Agent a receipt or receipts, or certified copies thereof, evidencing every such payment by Borrower, not later than forty-five (45) days after such payment is made. Notwithstanding the foregoing, nothing herein contained shall require Borrower to pay any taxes, assessments or governmental charges which Borrower in good faith disputes and which Borrower, at its own expense, is currently and diligently contesting, provided that applicable law allows non-payment thereof during the pendency of such contest, and provided further that Borrower complies with the provisions of Section 4.01(c) hereof.

(c)    Contest. Borrower shall not be required to pay any taxes, claims or governmental charges, or claims, or Liens being contested in accordance with the provisions of Section 4.01(a) or (b) hereof, as the case may be, so long as (i) Borrower diligently prosecutes such dispute or contest to a prompt determination in a manner not prejudicial to Administrative Agent or the Lenders and promptly pays all amounts ultimately determined to be owing, and (ii) Borrower provides security for the payment of such tax, assessment or governmental charge, or claim, or Lien (together with interest and penalties relating thereto) in an amount and in form and substance satisfactory to Administrative Agent. If Borrower shall fail to pay any such amounts ultimately determined to be owing or to proceed diligently to prosecute such dispute or contest as provided herein, then, upon the expiration of thirty (30) days after written notice to Borrower by Administrative Agent of Administrative Agent’s determination thereof, in addition to any other right or remedy of Administrative Agent, Administrative Agent may, but shall not be obligated to, discharge the same, and the cost thereof shall be reimbursed by Borrower to Administrative Agent. The payment by Administrative Agent of any delinquent tax, assessment or governmental charge, or any claim, or Lien which Administrative Agent in good faith believes might be prior hereto, shall be conclusive between the parties as to the legality and amount so paid, and Administrative Agent shall be subrogated to all rights, equities and liens discharged by any such expenditure to the fullest extent permitted by law.

4.02    Leases.

(a)    Affirmative Covenants. All apartment unit Leases shall be on market terms (subject to Borrower’s obligations under Section 4.14) and substantially in the form of the Form Lease. Borrower shall (i) duly and punctually observe, perform and discharge in all material respects the obligations, terms, covenants, conditions and warranties of Borrower as landlord under the Leases, (ii) give prompt notice to Administrative Agent of any

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material failure on the part of Borrower to observe, perform and discharge the same or of any written claim made by any Lessee of any such material failure by Borrower, (iii) enforce the performance of each and every material obligation, term, covenant, condition and agreement in the Leases to be performed by any Lessee or any guarantor, (iv) appear in and defend any action or proceeding arising under, occurring out of or in any manner connected with the Leases or the obligations, duties or liabilities of Borrower and any Lessee thereunder, and do so in the name and on behalf of Administrative Agent (for the benefit of the Lenders) upon request by Administrative Agent, but at the expense of Borrower, and pay all costs and expenses of Administrative Agent, including reasonable attorneys’ fees and disbursements, in any action or proceeding in which Administrative Agent may appear, (v) at the request of Administrative Agent, in confirmation of the assignment and transfer contemplated by the Assignment of Rents, execute and deliver to Administrative Agent assignments and transfers of all future Leases upon the same terms and conditions as contained in the Assignment of Rents, and (vi) make, execute and deliver to Administrative Agent upon demand and at any time or times, any and all assignments and other documents and instruments which Administrative Agent may deem advisable to carry out the true purposes and intent of the assignment set forth in the Assignment of Rents.

(b)    Negative Covenants. Unless Borrower first obtains the written consent of Administrative Agent, Borrower shall not (i) receive or collect any Rents from any Lessee for a period of more than one month in advance (provided that Borrower may collect at Lease execution first and last months’ rents and a security deposit), (ii) further pledge, transfer, mortgage or otherwise encumber or assign future payments of Rents, or (iii) waive, excuse, condone, discount, set off, compromise, or in any manner release or discharge any Lessee under any Lease of and from any material obligations, covenants, conditions and agreements to be kept, observed and performed by such Lessee, including the obligation to pay Rents thereunder, in the manner and at the time and place specified therein.

4.03    Operations of Borrower.

(a)    Without limitation of any other provisions of this Agreement or any other Loan Document, Borrower hereby represents and warrants to Borrower’s knowledge, without any knowledge imputed to Borrower by operation of law through any member or manager of Borrower prior to the date hereof, that it has not, and Borrower hereby covenants and agrees that it shall not hereafter:

(i)    engage in any business or activity other than the acquisition, development, construction, ownership, leasing, operation and maintenance of the Mortgaged Property, and activities incidental thereto;

(ii)    acquire or own any material asset other than the Property, the Improvements, and such incidental personal property as may be necessary for the construction and operation of the Improvements;

(iii)    merge into or consolidate with any Person or dissolve, terminate, divide (whether pursuant to a “plan of division” or other similar arrangement) or liquidate in whole or in part, transfer or otherwise dispose of all or substantially all of its assets or change its legal structure, without in each case the prior written consent of Administrative Agent;

(iv)    fail to preserve its existence as an entity duly organized, validly existing and in good standing (if applicable) under the laws of the jurisdiction of its organization or formation, or without the prior written consent of Administrative Agent, amend, modify, terminate or fail to comply with the provisions of Borrower’s organizational documents;

(v)    own any subsidiary or make any investment in or acquire the obligations or securities of any other Person without the prior written consent of Administrative Agent;

(vi)    commingle its assets with the assets of any of its partner(s), members, shareholders, Affiliates, or of any other Person or transfer any assets to any such Person other than distributions on account of equity interests in Borrower permitted hereunder and properly accounted for;

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(vii)    incur any Indebtedness other than Permitted Indebtedness;

(viii)    allow any Person to pay its debts and liabilities or fail to pay its debts and liabilities solely from its own assets;

(ix)    fail to maintain its records, books of account and bank accounts separate and apart from those of the shareholders, partners, members, principals and Affiliates of Borrower, the affiliates of a shareholder, partner or member of Borrower, and any other Person or fail to prepare and maintain its own financial statements in accordance with GAAP and susceptible to audit, or if such financial statements are consolidated, fail to cause such financial statements to contain footnotes disclosing that the Mortgaged Property is actually owned by Borrower;

(x)    enter into any contract or agreement with any shareholder, partner, member, principal or Affiliate of Borrower, any Guarantor or any shareholder, partner, member, principal or Affiliate thereof, except upon terms and conditions that are intrinsically fair and substantially similar to those that would be available on an arms-length basis with third parties other than any shareholder, partner, member, principal or Affiliate of Borrower or Guarantor, or any shareholder, partner, member, principal or Affiliate thereof;

(xi)    seek dissolution or winding up, in whole or in part;

(xii)    fail to correct any known misunderstandings regarding the separate identity of Borrower;

(xiii)    hold itself out to be responsible or pledge its assets or credit worthiness for the Indebtedness of another Person or allow any Person to hold itself out to be responsible or pledge its assets or credit worthiness for the Indebtedness of Borrower (except pursuant to the Loan Documents);

(xiv)    make any loans or advances to any third party, including any shareholder, partner, member, principal or Affiliate of Borrower, or any shareholder, partner, member, principal or Affiliate thereof;

(xv)    fail to file its own tax returns unless Borrower is a disregarded entity for Federal income tax purposes or to use separate contracts, purchase orders, stationery, invoices and checks;

(xvi)    fail either to hold itself out to the public as a legal entity separate and distinct from any Person or to conduct its business solely in its own name in order not (i) to mislead others as to the entity with which such other party is transacting business, or (ii) to suggest that Borrower is responsible for the Indebtedness of any third party (including any shareholder, partner, member, principal or affiliate of Borrower, or any shareholder, partner, member, principal or Affiliate thereof);

(xvii)    fail to allocate fairly and reasonably among Borrower and any third party (including, without limitation, any Guarantor) any overhead for common employees, shared office space or other overhead and administrative expenses;

(xviii)    allow any Person to pay the salaries of its own employees or fail to maintain a sufficient number of employees for its contemplated business operations;

(xix)    fail to maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations, provided that sufficient revenue is generated from the Property to maintain such capital, and provided that in no event shall this Section 4.03(a)(xix) require any Affiliate of Borrower to make any equity contribution or loan money to Borrower;

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(xx)    file a voluntary petition or otherwise initiate proceedings seeking liquidation, reorganization or other relief under any Federal, state or foreign Debtor Relief Laws, for Borrower or any general partner, manager or managing member of Borrower, or consent to the institution of, or fail to contest in a timely and appropriate manner, and proceeding or petition under Debtor Relief Laws against Borrower or any general partner, manager or managing member of Borrower, or file a petition seeking or consenting to reorganization or relief of Borrower or seek or consent to the appointment of any trustee, receiver, conservator, assignee, sequestrator, custodian, liquidator (or other similar official) of Borrower or any general partner, manager or managing member of Borrower or of all or any substantial part of the properties and assets of Borrower or any general partner, manager or managing member of Borrower, or make any general assignment for the benefit of creditors of Borrower or any general partner, manager or managing member of Borrower, or admit in writing the inability of Borrower or any general partner, manager or managing member of Borrower to pay its debts generally as they become due or declare or effect a moratorium on Borrower or any general partner, manager or managing member of Borrower debt or take any action in furtherance of any such action;

(xxi)    share any common logo with or hold itself out as or be considered as a department or division of (x) any shareholder, partner, principal, member or Affiliate of Borrower, (y) any Affiliate of a shareholder, partner, principal, member or Affiliate of Borrower, or (z) any other Person, or allow any Person to identify Borrower as a department or division of that Person, except with respect to “Cottonwood” which Administrative Agent hereby approves; or

(xxii)    conceal assets from any creditor, or enter into any transaction with the intent to hinder, delay or defraud creditors of Borrower or the creditors of any other Person.

The foregoing provisions of this Section 4.03 shall not operate to prohibit Borrower from entering into Swap Agreements otherwise permitted under this Agreement.

4.04    Appraisals.

Administrative Agent shall have the right to order new Appraisals of the Mortgaged Property from time to time. Each Appraisal is subject to review and approval by Administrative Agent. Borrower agrees upon demand to pay to Administrative Agent the cost and expense for such Appraisals. Borrower’s obligation to pay such cost and expense shall be limited to one Appraisal per year, unless the Appraisal is ordered after the occurrence of a Default or is required by Legal Requirement or is required in connection with Borrower’s exercise of an extension option pursuant to Section 3.15.

4.05    Operating and Reserve Accounts.

Borrower shall maintain all operating and reserve accounts for the Mortgaged Property with Administrative Agent, and such accounts, upon the request of Administrative Agent, shall be pledged to Administrative Agent, for the benefit of Lenders, to secure the Obligations.

4.06    Prohibited Distributions.

After the occurrence and during the continuation of a Default or Unmatured Default, Borrower shall not make any dividend or distribution to its members, or make any other payment to Persons holding a direct or indirect ownership interest in Borrower or engage in any transaction that has a substantially similar effect.

4.07    Borrower’s Right to Contest Legal Requirements.

Notwithstanding any provision of this Agreement or any of the other Loan Documents to the contrary, no Default or Unmatured Default shall occur hereunder as a result of the failure of Borrower or the Property or Improvements to comply with any Legal Requirement, including, without limitation, Environmental Laws, so long as the following conditions are satisfied:

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(a)    Borrower is contesting the applicability of such Legal Requirement to Borrower or the Property or Improvements in good faith and has so notified Lender;

(b)    Borrower has properly commenced and is diligently pursuing such contest;

(c)    the contest will not materially impair the ability to ultimately comply with the contested Legal Requirement should the contest not be successful and the conduct of the contest will not materially impair Borrower’s ability to Substantially Complete the Improvements by the Final Completion Date;

(d)    Borrower demonstrates to Administrative Agent’s satisfaction that Borrower has the financial capability to undertake and pay for such contest and any corrective or remedial action then or thereafter likely to be necessary;

(e)    Neither Administrative Agent nor any Lender is at risk for any material liability due to Borrower’s non-compliance with such Legal Requirement; and

(f)    Borrower’s non-compliance with such Legal Requirement will not result in a Lien or charge on the Property or the Improvements, the enforcement of which is not stayed by such contest or insured over to the satisfaction of Administrative Agent.

4.08    Government Regulation.

Borrower shall not (a) be or become subject at any time to any law, regulation, or list of any Governmental Authority (including, without limitation, the U.S. Office of Foreign Asset Control list) that prohibits or limits the Lenders from making any advance or extension of credit to Borrower or from otherwise conducting business with Borrower, or (b) fail to provide, promptly following any request therefor, information and documentation reasonably requested by Administrative Agent or any Lender for purposes of compliance with applicable “know your customer” and anti-money laundering rules and regulations including the Patriot Act and the Beneficial Ownership Regulation.

4.09    Financial Information and Other Deliveries.

(a)    Borrower.

(i)    Within sixty (60) days after the end of each of Borrower’s fiscal quarters, Borrower shall deliver to Administrative Agent by electronic communication as provided in Section 11.01 (A) an operating statement (showing actual to budgeted results) and a lease status report (including a rent roll) for the Property and Improvements, each dated as of the last day of such fiscal quarter, and (B) a balance sheet, statement of operations, each dated as of the last day of such fiscal quarter, in form and substance satisfactory to Administrative Agent and certified by the chief financial officer of Borrower.

(ii)    Within ninety (90) days after the end of each of Borrower’s fiscal years, Borrower shall deliver to Administrative Agent by electronic communication as provided in Section 11.01, a balance sheet, and statement of operations, each dated as of the last day of such fiscal year, in form and substance satisfactory to Administrative Agent and certified by an independent auditor acceptable to Administrative Agent.

(iii)    Concurrently with the delivery of the information referred to in Section 4.09(a)(i) and (ii) above, Borrower shall deliver to Administrative Agent by electronic communication as provided in Section 11.01, a compliance certificate substantially in the form of Exhibit E-1.

(iv)    Borrower shall promptly deliver to Administrative Agent written notice of (x) the occurrence of any Default or Unmatured Default or the occurrence of an event which would make representation or warranty contained herein untrue or misleading in any material respect as of the date of such event, or (y) any change in the information provided in the Beneficial Ownership Certification that would result in a change to the list of beneficial owners identified in such certification.

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(v)    Borrower shall promptly deliver to Administrative Agent such other information and materials with respect to Borrower, the Mortgaged Property, the Project, the Guarantor, or compliance with the terms of this Agreement, as Administrative Agent or any Lender may reasonably request.

(b)    Guarantor.

(i)    Within sixty (60) days after the end of each of Guarantor’s fiscal quarters, Borrower shall deliver to Administrative Agent by electronic communication as provided in Section 11.01, a balance sheet, statement of operations and statement of cash flow for Guarantor, each dated as of the last day of such fiscal quarter, in form and substance satisfactory to Administrative Agent and certified by the chief financial officer of Guarantor;

(ii)    Within ninety (90) days after the end of each of Guarantor’s fiscal years, Borrower shall deliver to Administrative Agent by electronic communication as provided in Section 11.01, a balance sheet, a statement of operations and a statement of cash flow for Guarantor, each dated as of the last day of such fiscal year, in form and substance satisfactory to Administrative Agent and audited by an independent auditor acceptable to Administrative Agent.

(iii)    Concurrently with the delivery of the information referred to in Section 4.09(b)(i) and (ii) above, Borrower shall deliver to Administrative Agent by electronic communication as provided in Section 11.01, a compliance certificate substantially in the form of Exhibit E-2.

(iv)    Borrower shall deliver to Administrative Agent such other information and materials with respect to Guarantor as Administrative Agent shall request.

4.10    Hazardous Substances.

Borrower warrants, represents and covenants as follows:

(a)    Report; Compliance with Environmental Laws. Borrower has caused the preparation of that certain Phase I Environmental Site Assessment Report of the Property, prepared by Partner Engineering and Science, Inc., dated as of January 15, 2020 (the “Report”), and except as disclosed in the Report, to the actual knowledge of Borrower, the Property is in full compliance with all Environmental Laws.

(b)    No Liens, Notices or Actions. Except as disclosed in the Report, neither Borrower nor the Property are subject to any private or governmental Lien or judicial or administrative notice or action pending, or to Borrower’s actual knowledge, threatened, relating to Hazardous Substances or the environmental condition of the Property.

(c)    No Hazardous Substances; Compliance with Environmental Laws. Except as disclosed in the Report and except as may be permitted under the Environmental Indemnity Agreement, to Borrower’s actual knowledge, no Hazardous Substances are located on or have been stored, processed or disposed of on or released or discharged from (including ground water contamination) the Property, and no above or underground storage tanks exist on the Property. Except as permitted by the Environmental Indemnity Agreement, Borrower shall not allow any Hazardous Substances to be stored, located, discharged, possessed, managed, processed or otherwise handled on the Property and shall comply with all Environmental Laws affecting the Property.

(d)    Notice. Borrower shall immediately notify Administrative Agent should Borrower become aware of (i) any Hazardous Substance or other environmental problem or liability with respect to the Property or (ii) any Lien, action, or notice of the nature described in Section 4.15(b) above.

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4.11    ERISA.

(a)    Plan Assets; Compliance; No Material Liability. Borrower hereby covenants and agrees that (i) Borrower shall not use any Plan Assets to repay or secure the Obligations, (ii) no assets of Borrower or Guarantor are or will be Plan Assets, (iii) Borrower does not sponsor, maintain, or contribute to any Employee Benefit Plan and Borrower will not sponsor, maintain or contribute to any Employee Benefit Plan, (iv) Borrower does not have, and will not have, any liability, direct or indirect, with respect to any Employee Benefit Plan, (v) Borrower does not and will not have any employees that are covered by any Employee Benefit Plan and (vi) Borrower will not have any liability, direct or indirect, under Title IV of ERISA or Section 412 of the Code with respect to any Employee Benefit Plan.

(b)    Transfer of Interests. In addition to the prohibitions set forth in this Agreement and the other Loan Documents, and not in limitation thereof, Borrower hereby covenants and agrees that Borrower shall not assign, sell, pledge, encumber, transfer, hypothecate or otherwise dispose of its interests or rights (direct or indirect) in any Loan Document or any portion of the Mortgaged Property or attempt to do any of the foregoing or suffer any of the foregoing, or permit any party with a direct or indirect interest or right in any Loan Document or any portion of the Mortgaged Property to do any of the foregoing, if such action would (i) cause this Agreement, any of the other Loan Documents, or the Obligations or the exercise of any of Administrative Agent’s or any Lender’s rights in connection therewith, to constitute a prohibited transaction under Section 406 of ERISA or Section 4975 of the Code (unless Borrower furnishes to Administrative Agent a legal opinion reasonably satisfactory to Administrative Agent that the transaction is exempt from the prohibited transaction provisions of ERISA and the Code) or (ii) result in the Mortgaged Property, or assets of Borrower or Guarantor being Plan Assets.

(c)    Indemnity. Borrower hereby agrees to indemnify Administrative Agent, each Lender, their respective Affiliates, and each of their directors, officers and employees against all losses, claims, damages, penalties, judgments, liabilities and expenses (including, without limitation, all expenses of litigation or preparation therefor whether or not Administrative Agent, any Lender or any Affiliate is a party thereto) which any of them may actually pay or incur by reason of the investigation, defense and settlement of claims and in obtaining any prohibited transaction exemption under ERISA or the Code necessary in Administrative Agent’s or any Lender’s judgment by reason of the inaccuracy of the representations and warranties set forth in Section 6.01(i) hereof or a breach of the provisions set forth in this Section 4.11. The obligations of Borrower under this Section 4.11 shall survive the termination of this Agreement.

4.12    Compliance with Laws.

Borrower shall comply with all Legal Requirements applicable to it or the Property (including, without limitation, the Mortgaged Property). Borrower will maintain in effect and enforce any policies and procedures designed to ensure compliance by Borrower, its Affiliates and their respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions.

4.13    Use of Proceeds.

Borrower shall not request any Transaction and none of Borrower, Guarantor, their respective directors and officers, or any Person participating in any capacity in any Transaction, shall use, the proceeds of the Transactions (a) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of any Anti-Corruption Laws, (b) for the purpose of funding, financing or facilitating any activities, business or transaction of or with any Sanctioned Person, or in any Sanctioned Country, except to the extent permitted for a Person required to comply with Sanctions, or (c) in any manner that would result in the violation of any Sanctions applicable to any party hereto.

4.14    Massachusetts General Laws Chapter 40B.

Borrower shall, and shall cause Property Manager to, comply with all requirements under the Comprehensive Permit Documents and Legal Requirements related thereto. Neither Borrower nor Property Manager shall do or cause to be done anything that could result in a default (after all applicable notice and cure periods) under the Comprehensive Permit Documents or Legal Requirements related thereto.

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4.15    Debt Service Coverage Ratio.

Commencing with the calendar quarter ending June 30, 2020 and thereafter for each subsequent calendar quarter during the term of the Loan, Borrower shall, concurrently with Borrower’s deliveries under Section 4.09(a) (i.e. within sixty (60) days following the end of each of Borrower’s fiscal quarters, deliver to Lender a certificate (a “Borrower’s Compliance Certificate”) in the form of Exhibit E-1 signed by an authorized representative of Borrower, with an equivalent role of a chief or senior financial officer, setting forth Borrower’s calculation of the Debt Service Coverage Ratio as of the last day of such calendar quarter. If the Debt Service Coverage Ratio as of the last day of any calendar quarter during the term of the Loan is less than 1.15 to 1.00, then Borrower shall, within thirty (30) days following written notice from Administrative Agent, repay the principal balance of the Loan in an amount determined by Administrative Agent to be sufficient to cause the Debt Service Coverage Ratio, upon recalculation, to exceed than 1.15 to 1.00.

4.16    Post-Closing Covenant. Following the Closing Date, Borrower shall use commercially reasonable efforts to obtain and cause to be filed releases and/or terminations of all liens and security interests affecting the Mortgaged Property immediately prior to the effectiveness of this Agreement.

ARTICLE V

COLLATERAL ASSIGNMENT AND SECURITY AGREEMENT

5.01    Permits

(a)    Collateral Assignment and Security Agreement. As additional security for the Obligations, Borrower hereby sells, assigns, transfers, sets over and grants to Administrative Agent, for the benefit of the Lenders, a security interest in, all of Borrower’s right, title and interest in and to all Permits.

(b)    Remedies Upon Default. Upon the occurrence and during the continuance of a Default, Administrative Agent shall have the right but not the obligation, and Borrower hereby authorizes Administrative Agent, to enforce Borrower’s rights with respect to the Permits.

(c)    Power of Attorney. Effective upon the occurrence and during the continuance of a Default, Borrower hereby irrevocably constitutes and appoints Administrative Agent as its attorney-in-fact, coupled with an interest, to demand, receive and enforce Borrower’s rights with respect to the Permits, to give appropriate receipts, releases and satisfactions for and on behalf of Borrower and to do any and all acts in the name of Borrower or in the name of Administrative Agent with the same force and effect as if Borrower had performed such acts.

(d)    License. Provided no Default has occurred and is continuing, Borrower shall have the right under a license granted hereby to exercise its rights with respect to the Permits. The license granted hereby shall be revoked at Administrative Agent’s option upon written notice from Administrative Agent to Borrower after the occurrence and during the continuance of a Default.

(e)    No Assumption of Liabilities. Administrative Agent does not hereby assume any of Borrower’s obligations or duties with respect to the Permits, including, without limitation, the obligation to pay for the preparation or issuance thereof.

(f)    No Prior Conveyance or Limiting Action. Borrower represents and warrants that it has not previously conveyed, transferred or assigned the Permits or any right, title or interest therein and has not executed any other instrument which might prevent or limit Administrative Agent from operating under the terms and provisions of the assignment contemplated hereby, and Borrower covenants and agrees not to do any of the foregoing.

5.02    Project Documents and Swap Agreements.

(a)    Collateral Assignment and Security Agreement. As additional security for the Obligations, Borrower hereby sells, assigns, transfers, sets over and grants to Administrative Agent, for the benefit of the Lenders, a security interest in, all of its right, title and interest in and to the Project Documents and any Swap Agreements.

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(b)    Performance; Enforcement. Borrower shall perform and observe in a timely manner all material covenants, conditions, obligations and agreements on the part of Borrower to be performed or observed under the Project Documents and any Swap Agreements. Borrower shall not waive, excuse, condone or in any manner release or discharge any party to a Project Document or any Swap Agreement from any material covenants, conditions, obligations or agreements to be performed or observed by such party under such Project Document or Swap Agreement, as applicable, but shall, at its sole cost and expense, enforce and secure the performance of all material covenants, conditions, obligations and agreements to be observed by all parties under the Project Documents and any Swap Agreements.

(c)    Remedies Upon Default. Upon the occurrence and during the continuance of a Default, Administrative Agent shall have the right but not the obligation, and Borrower hereby authorizes Administrative Agent to enforce Borrower’s rights under the Project Documents and any Swap Agreements and to receive the performance of any other Person that is a party to the Project Documents and any Swap Agreements.

(d)    Notices of Default. Borrower shall send to Administrative Agent any written notice of a material default or material breach of or under the Project Documents or any Swap Agreements that Borrower sends to (such notice to Administrative Agent to be sent simultaneously therewith) or receives from (such notice to Administrative Agent to be sent immediately upon receipt by Borrower thereof) any Person that is a party to any Project Document or Swap Agreement.

(e)    Power of Attorney. Effective upon the occurrence and during the continuance of a Default, Borrower hereby irrevocably constitutes and appoints Administrative Agent as its attorney-in-fact, coupled with an interest, to demand, receive and enforce Borrower’s rights with respect to the Project Documents and any Swap Agreements, to give appropriate receipts, releases and satisfactions for and on behalf of Borrower and to do any and all acts in the name of Borrower or in the name of Administrative Agent with the same force and effect as if Borrower had performed such acts.

(f)    License. Provided no Default has occurred and is continuing, Borrower shall have the right under a license granted hereby to exercise its rights under the Project Documents and any Swap Agreements. The license granted hereby shall be revoked at Administrative Agent’s option upon written notice from Administrative Agent to Borrower after the occurrence and during the continuance of a Default.

(g)    No Assumption of Liability. Administrative Agent does not hereby assume any of Borrower’s obligations or duties under the Project Documents or any Swap Agreements, including, without limitation, the obligation to pay for services rendered thereunder.

(h)    Validity and Enforceability of Project Documents and Swap Agreements. Borrower represents and warrants that, to Borrower’s actual knowledge, the Project Documents and any Swap Agreements are valid, binding and enforceable (subject to Debtor Relief Laws and general equitable principles), are in full force and effect, and there are no material breaches or defaults thereunder and no events have occurred which with notice and/or lapse of time will constitute a material breach or default thereunder by Borrower or any Affiliate of Borrower. Borrower represents and warrants that it has full power, right and authority to execute and enter into the Project Documents and any Swap Agreements.

(i)    No Prior Conveyance or Limiting Actions. Borrower represents and warrants that it has not previously conveyed, transferred or assigned the Project Documents or any Swap Agreements or any right, title or interest therein and has not executed any other instrument which might prevent or limit Administrative Agent from operating under the terms and provisions of the assignment contemplated hereby, and Borrower covenants and agrees not to do any of the foregoing.

(j)    Execution and Amendment of Project Documents. Borrower represents and warrants that, as of the date hereof, the only Project Documents in existence is the Property Management Agreement and there are no Swap Agreements in existence. Borrower shall not enter into any other Project Document or Swap Agreement, or alter, amend or change in any material respect, or terminate or cancel, any Project Document or Swap Agreement, in each case without obtaining Administrative Agent’s prior written consent. Administrative Agent may require, as a condition to its approval of a Project Document or Swap Agreement, the execution by the contracting party of an

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agreement, in form and substance acceptable to Administrative Agent, whereby said contracting party (i) acknowledges the provisions of this Section 5.03, (ii) subordinates its claims against Borrower to payment in full of the Obligations and to the rights of Administrative Agent under the Loan Documents and (iii) agrees that upon the occurrence and during the continuance of a Default, Administrative Agent has the right (but not the obligation) to terminate the subject Project Document.

5.03    Reassignment.

Upon the indefeasible payment by Borrower in full of all of the Obligations and termination of the Commitments, all of Administrative Agent’s interest in the Permits and the Material Agreements shall automatically be deemed reassigned to Borrower (or terminated if so requested by Borrower) and Administrative Agent shall have no further interest therein. Upon written request from Borrower, Administrative Agent shall, at Borrower’s expense, execute such documentation as is reasonably necessary to reassign or terminate such interest without recourse to Administrative Agent.

5.04    Additional Instruments.

At Administrative Agent’s request, Borrower shall execute and deliver to Administrative Agent any and all assignments and other documents and instruments reasonably necessary to confirm the collateral assignments contemplated by this Article V.

ARTICLE VI

REPRESENTATIONS AND WARRANTIES

6.01    Representations and Warranties.

As a material inducement to Administrative Agent and the Lenders to enter into this Agreement, and as an express condition to each Advance made hereunder, Borrower hereby represents and warrants, as follows:

(a)    Existence; Power and Authority. Borrower is a limited liability company duly formed and validly existing in the State of Delaware and in good standing under the laws of the States of Delaware and Massachusetts, with requisite power and authority to (i) incur the Obligations, and (ii) execute, deliver and perform this Agreement and the other Loan Documents to which it is a party.

(b)    Authorization; No Conflict. Borrower’s execution and delivery to Administrative Agent of this Agreement and the other Loan Documents and the full and complete performance of the provisions thereof (i) are authorized by Borrower’s operating agreement; (ii) have been duly authorized by all requisite member actions; (iii) do not require the approval or consent of any Governmental Authority having jurisdiction over Borrower or any of the Mortgaged Property except for consents or approvals that have been obtained; and (iv) will not result in any breach of, or constitute a default under, or result in the creation of any Lien, (other than those contained in any of the Loan Documents) upon any property or assets of Borrower under any indenture, mortgage, deed of trust, bank loan or credit agreement or other instrument or agreement to which Borrower is a party or by which Borrower or any of the Mortgaged Property is bound.

(c)    Title. Borrower is the sole legal and beneficial owner of the Mortgaged Property free and clear of all Liens other than the Permitted Encumbrances.

(d)    Financial Statements and Disclosures.

(i)    Any and all balance sheets, statements of income or loss, and financial statements heretofore furnished to Administrative Agent with respect to Borrower and Guarantor are true and correct in all material respects as of the dates thereof, and fully and accurately present the financial condition of the subjects thereof as of the dates thereof, and no material adverse change has occurred in the financial condition reflected therein since the dates of the most recent thereof. Neither Borrower nor Guarantor has any contingent liabilities, liabilities for taxes, unusual forward or long-term commitments or unrealized or

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anticipated losses from any unfavorable commitments which are reasonably likely to result in a material adverse effect on the Mortgaged Property or the development, construction or operation of the Improvements as contemplated by the Loan Documents or on the financial condition of Borrower or Guarantor or their respective abilities to perform their obligations under the Loan Documents and the Project Documents.

(ii)    As of the Closing Date, to the best knowledge of Borrower, the information included in the Beneficial Ownership Certification provided on or prior to the Closing Date to any Lender in connection with this Agreement is true and correct in all respects.

(e)    Litigation. There are no actions, suits or other legal proceedings pending, or to the actual knowledge of Borrower, threatened, against or affecting Borrower, the Mortgaged Property, or the Guarantor which (i) if adversely determined would materially and adversely affect the ability of Borrower or Guarantor to perform its respective obligations under the Loan Documents or Project Documents or would have a material adverse effect on the use or value of the Mortgaged Property, or (ii) challenge the validity or enforceability of the Loan Documents or the priority of the Lien and security interest created thereby.

(f)    Legal Compliance. The Improvements and the use and occupancy thereof will comply in all material respects with all applicable Legal Requirements. Neither the zoning nor any other right to use or operate the Improvements is to any extent dependent upon or related to any real estate other than the Property.

(g)    Services and Utilities. All streets, easements, utilities and related services necessary for the operation of the Improvements for their intended purpose are, or when required, will be, available to the Property.

(h)    Enforceability. Each Loan Document executed by Borrower constitutes a legal and binding obligation of, and is valid and enforceable against, Borrower in accordance with the terms thereof (subject to Debtor Relief Laws and general equitable principles) and is not subject to any right of rescission, setoff, counterclaim or defense.

(i)    ERISA. Borrower is not an “employee benefit plan” as defined in Section 3(3) of ERISA or a “plan” as defined in Section 4975(e)(1) of the Code. Borrower does not sponsor, maintain, or contribute to any Employee Benefit Plan and the Borrower will not sponsor, maintain or contribute to any Employee Benefit Plan. Borrower does not have, and will not have, any liability, direct or indirect, with respect to any Employee Benefit Plan. Borrower does not and will not have any employees that are covered by any Employee Benefit Plan.    None of the Employee Benefit Plans is subject to the requirements of Section 412 of the Code, Part 3 of Title I of ERISA or Title IV of ERISA or is a “multiemployer plan” as defined in Section 3(37) of ERISA.

(j)    Legal Parcel; Separate Tax Parcel. The Mortgaged Property is taxed separately and does not include any other property, and for all purposes the Property may be mortgaged, conveyed and otherwise dealt with as a separate legal parcel.

(k)    Leases and Rents. Borrower has good and marketable title to the Leases and rents free and clear of all claims, and Liens other than the Permitted Encumbrances. To the knowledge of Borrower, the Leases are valid and unmodified and are in full force and effect and Borrower is not in default of any of the material terms or provisions thereof. Except to the extent Borrower has collected first and last months’ rents and a security upon execution of a Lease, the rents now due or to become due for any periods subsequent to the date hereof have not been collected and payment thereof has not been anticipated for a period of more than one month in advance, waived or released, discounted, set off or otherwise discharged or compromised. Borrower has not received any funds or deposits from any Lessee for which credit has not already been made on account of accrued rents other than security deposits required by the Leases.

(l)    Compliance with Laws and Agreements. Except where the failure to do so, individually or in the aggregate could not reasonably be expected to result in a material adverse effect, Borrower is in compliance with (i) its charter, by-laws or other organizational documents, (ii) all Legal Requirements applicable to it or its property (including, without limitation, the Mortgaged Property) and (iii) all indentures, agreements and other instruments binding upon it or its property (including, without limitation, the Mortgaged Property). No Default has occurred and is continuing.

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(m)    Anti-Corruption Laws and Sanctions. Borrower has implemented and maintains in effect policies and procedures designed to ensure compliance by, Borrower, Guarantor, their respective directors and officers, or any Person participating in any capacity in any Transaction, with Anti-Corruption Laws and applicable Sanctions, and each of Borrower, Guarantor, their respective directors and officers, or any Person participating in any capacity in any Transaction, is in compliance with Anti-Corruption Laws and applicable Sanctions in all material respects. None of Borrower, Guarantor, their respective directors and officers, or any Person participating in any capacity in any Transaction is a Sanctioned Person. No Transaction will violate Anti-Corruption Laws or applicable Sanctions.

(n)    EEA Financial Institutions. Neither Borrower nor any Guarantor is an EEA Financial Institution.

6.02    Nature of Representations and Warranties.

All representations and warranties made in this Agreement or any other Loan Document or in any certificate or other document delivered to Administrative Agent pursuant to or in connection with this Agreement shall be deemed to have been relied upon by Administrative Agent and the Lenders notwithstanding any investigation heretofore or hereafter made by Administrative Agent or on its behalf.

ARTICLE VII

INSURANCE AND CONDEMNATION

7.01    Insurance and Casualty.

(a)    Required Insurance Coverage. Borrower, at its expense, shall maintain and provide to Administrative Agent copies of policies or other satisfactory evidence of insurance providing the following:

(i)    Commercial General Liability Insurance with limits of not less than $1,000,000 per occurrence combined single limit and $2,000,000 in the aggregate for the policy period, or in whatever higher amounts as may be required by Administrative Agent from time to time by notice to Borrower (with deductibles reasonably acceptable to Administrative Agent), and extended to cover: (a) Contractual Liability assumed by Borrower with defense provided in addition to policy limits for indemnities of the named insured, (b) if any of the work is subcontracted, Independent Contractors Liability providing coverage in connection with such portion of the work which may be subcontracted, (c) Broad Form Property Damage Liability, (d) Products & Completed Operations for coverage, such coverage to apply for two years following completion of construction, (e) waiver of subrogation against all parties named additional insured, (f) severability of interest provision, and (g) Personal Injury & Advertisers Liability.

(ii)    Automobile Liability including coverage on owned, hired and non-owned automobiles and other vehicles, if used in connection with the performance of the work, with Bodily Injury and Property Damage limits of not less than $1,000,000.00 per occurrence combined single limit, with a waiver of subrogation against all parties named as additional insured.

(iii)    Umbrella/Excess Liability in excess of Commercial General Liability, Automobile Liability and Employers’ Liability coverages which is at least as broad as these underlying policies with a limit of liability of $10,000,000.00.

(iv)    All-Risk Property (Special Cause of Loss) Insurance, including, without limitation as to the type of coverage, coverage for loss or damage to the Property and Improvements by fire and other perils including windstorm, earthquake/earth movement and malicious mischief, building ordinance extension endorsement (including cost of demolition, increased costs of construction and the value of the undamaged portion of the building and soft costs coverage), and boiler and machinery coverage (if

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separate policy, that policy must include loss of rents or business interruption coverage), as specified by Administrative Agent. The policy shall be in an amount not less than the full insurable value on a replacement cost basis of the insured Property and Improvements and personal property related thereto (without deduction for depreciation). If the policy is a blanket policy covering the Property and Improvements and one or more other properties, the policy must specify the dollar amount of the total blanket limit of the policy that is allocated to each property, and the amount so allocated to the Property and Improvements must not be less than the full insurable value on a replacement cost basis. During any construction period, such policy shall be written in the so-called “Builder’s Risk Completed Value Non-Reporting Form” with no coinsurance requirement and shall contain a provision granting the insured permission to occupy prior to completion. Such policy shall not contain an exclusion for terrorist losses. However, if such an exclusion exists in the All-Risk policy, a separate Terrorism policy covering Certified Acts of Terrorism must be evidenced to Administrative Agent in an amount equal to the full replacement cost of the Property and Improvements, or the amount of the Loan, whichever is less. This policy must also list Administrative Agent as mortgagee and loss payee.

(v)    Workers’ Compensation and Employer’s Liability Insurance in accordance with the applicable laws of the state in which the work is to be performed or of the state in which Borrower is obligated to pay compensation to employees engaged in the performance of the work. The policy limit under the Employer’s Liability Insurance section shall not be less than $1,000,000.00 for any one accident.

(vi)    If at any time, the Improvements or any part thereof, lies within a “special flood hazard area” as designated on maps prepared by FEMA, a one hundred year flood plain or other area identified by Administrative Agent as having a high or moderate risk of flooding, a flood insurance policy or policies (whether or not coverage is available from the National Flood Insurance Program and whether or not required by the Flood Laws), in form and substance acceptable to Administrative Agent covering the Improvements and contents (to the extent the contents secure the Obligations), for the duration of the Loans in an amount at least equal to the full insurable value on a replacement cost basis (without deduction for depreciation) of the Improvements and contents, if applicable, or the amount of the Obligations, whichever is less.

(vii)    [intentionally omitted]

(viii)    Rent loss or business interruption insurance against loss of income (including, but not limited to, rent, cost reimbursements and all other amounts payable by tenants under Leases or otherwise derived by Borrower from the operation of the Project) arising out of damage to or destruction of the Property and Improvements by fire or other peril (including earthquake if required) insured against under each policy. The amount of the policy shall be in the amount equal to one year’s projected rentals or gross revenue.

(ix)    Such other insurance coverages in such amounts as Administrative Agent may require, which may include, without limitation, errors and omissions insurance with respect to the contractors, architects and engineers.

(b)    Policy Requirements; Insurance Consultant. All insurance policies shall (i) be issued by an insurance company licensed to do business in the state where the Project is located having a rating of “A-” VIII or better by A.M. Best Co., in Best’s Rating Guide, (ii) name “JPMorgan Chase Bank, N.A., in its capacity as Administrative Agent for itself and each Lender” as additional insured on all liability insurance and as mortgagee and loss payee on all All-Risk Property, flood insurance, earthquake insurance and rent loss or business interruption insurance (whether or not required hereunder), (iii) be endorsed to show that Borrower’s insurance shall be primary and all insurance carried by Administrative Agent is strictly excess and secondary and shall not contribute with Borrower’s insurance, (iv) provide that Administrative Agent is to receive thirty (30) days written notice prior to non-renewal or cancellation, (v) be evidenced by a certificate of insurance to be provided to Administrative Agent along with a copy of the policy for All-Risk Property coverage or such other evidence of insurance acceptable to Administrative Agent in its reasonable discretion, (vi) include either policy or binder numbers on the ACORD form, and (vii) be in form and amounts acceptable to Administrative Agent; provided, however, that with respect to any flood insurance required hereunder, acceptable proof of coverage shall consist of a copy of the insurance policy, the declarations page of the insurance policy or an application plus proof of premium payment (with a copy of the policy

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or declarations page provided to Administrative Agent within 30 days thereafter) and shall not include ACORD or other forms of certificates of insurance. Administrative Agent, at its option and upon notice to Borrower, may retain, at Borrower’s expense, an insurance consultant to review the insurance for the Property and Improvements to confirm that it complies with the terms and conditions set forth herein.

(c)    Evidence of Insurance; Payment of Premiums. Borrower shall deliver to Administrative Agent, at least five (5) Business Days before the expiration of an existing policy, evidence acceptable to Administrative Agent of the continuation of the coverage of the expiring policy. If Administrative Agent has not received satisfactory evidence of such continuation of coverage in the time frame herein specified, Administrative Agent shall have the right, but not the obligation, to purchase such insurance for Administrative Agent’s and the Lenders’ interests only. Any amounts so disbursed by Administrative Agent pursuant to this Section shall be repaid by Borrower within 10 days after written demand therefor. Nothing contained in this Section shall require Administrative Agent to incur any expense or take any action hereunder, and inaction by Administrative Agent shall never be considered a waiver of any right accruing to Administrative Agent on account on this Section. The payment by Administrative Agent of any insurance premium for insurance which Borrower is obligated to provide hereunder but which Administrative Agent believes has not been paid, shall be conclusive between the parties as to the legality and amounts so paid. Borrower agrees to pay all premiums on such insurance as they become due, and will not permit any condition to exist on or with respect to the Mortgaged Property which would wholly or partially invalidate any insurance thereon.

(d)    Collateral Protection. Unless Borrower provides Administrative Agent with evidence satisfactory to Administrative Agent of the insurance coverage required by this Agreement, Administrative Agent may purchase insurance at Borrower’s expense to protect Administrative Agent’s and the Lenders’ interests in the Mortgaged Property. This insurance may, but need not, protect Borrower’s interest in the Mortgaged Property. The coverages that Administrative Agent purchases may not pay any claim that Borrower makes or any claim that is made against Borrower in connection with the Mortgaged Property. Borrower or Administrative Agent (as appropriate) may later cancel any insurance purchased by Administrative Agent, but only after Administrative Agent receives satisfactory evidence that Borrower has obtained insurance as required by this Agreement. If Administrative Agent purchases insurance for the Mortgaged Property, Borrower will be responsible for the costs of that insurance, including any charges imposed by Administrative Agent in connection with the placement of insurance, until the effective date of the cancellation or expiration of such insurance. The costs of the insurance may, at Administrative Agent’s discretion, be added to Borrower’s total principal obligation owing to Administrative Agent and the Lenders, and in any event shall be secured by the liens on the Mortgaged Property created by the Loan Documents. It is understood and agreed that (i) the costs of insurance obtained by Administrative Agent may be more than the costs of insurance Borrower may be able to obtain on its own and (ii) in the case of flood insurance, the amount of coverage may be more than required by the Flood Laws.

(e)    No Liability; Assignment. Administrative Agent shall not by the fact of approving, disapproving, accepting, preventing, obtaining or failing to obtain any such insurance, incur any liability for the form or legal sufficiency of insurance contracts, solvency of insurers, or payment of losses, and Borrower hereby expressly assumes full responsibility therefor and all liability, if any, thereunder. Borrower hereby absolutely assigns and transfers to Administrative Agent, for the benefit of the Lenders, all of Borrower’s right, title and interest in and to any unearned premiums paid on policies and any claims thereunder and Administrative Agent and/or the Lenders shall have the right, but not the obligation, to assign any then existing claims under the same to any purchaser of the Mortgaged Property at any foreclosure sale; provided, however, that so long as no Default exists and is continuing hereunder, Borrower shall have the right under a license granted hereby, and Administrative Agent hereby grants to Borrower a license, to exercise rights under said policies and in and to said premiums subject to the provisions of this Agreement. Said license shall be revoked automatically upon the occurrence and during the continuance of a Default hereunder. In the event of a foreclosure of the Mortgage, or other transfer of title to the Mortgaged Property in extinguishment in whole or in part of the Loans, all right, title and interest of Borrower in and to the insurance policies then in force and all proceeds payable thereunder shall thereupon vest in the purchaser at such foreclosure or Administrative Agent on behalf of the Lenders or other transferee in the event of such other transfer of title.

(f)    No Separate Insurance. Borrower shall not carry any separate insurance on the Mortgaged Property concurrent in kind or form with any insurance required hereunder or contributing in the event of loss without Administrative Agent’s prior written consent, and any such policy shall have attached a standard non-contributing mortgagee clause, with loss payable to Administrative Agent, for the benefit of the Lenders, and shall otherwise meet all other requirements set forth herein.

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(g)    Casualty Loss.

(i)    If all or any part of the Mortgaged Property shall be damaged or destroyed by fire or other casualty, Borrower shall give immediate written notice and make a claim to the insurance carrier and Administrative Agent. With respect to any such casualty loss for which Borrower has an insurance claim that exceeds One Million Dollars ($1,000,000.00), Borrower hereby authorizes and empowers Administrative Agent, at Administrative Agent’s option and in Administrative Agent’s sole discretion as attorney-in-fact for Borrower, to make proof of loss, to adjust and compromise any claim under insurance policies, to appear in and prosecute any action arising from such insurance policies, to collect and receive insurance proceeds, and to deduct therefrom Administrative Agent’s expenses incurred in the collection of such proceeds; provided, however, that the foregoing authorization and empowerment of Administrative Agent to act as attorney-in-fact for Borrower shall not become effective until the occurrence and during the continuance of a Default or until such time as Borrower fails to diligently pursue the collection of such insurance proceeds in Administrative Agent’s opinion. The foregoing appointment is irrevocable, coupled with an interest, and continuing so long as the Commitments or Obligations remain outstanding, and such rights, powers and privileges shall be exclusive in Administrative Agent (for the benefit of the Lenders), its successors and assigns.

(ii)    As sole loss payee (or, if JPMorgan is the only Lender, as an additional loss payee) on all policies of casualty insurance, Administrative Agent shall receive all insurance proceeds from any casualty loss in excess of One Million Dollars ($1,000,000.00), and shall hold the same in an interest-bearing account pending disposition in accordance with this Section; provided, however, that if the insurance proceeds with respect to a particular event are One Million Dollars ($1,000,000) or less, Administrative Agent shall pay such proceeds within a reasonable time following receipt thereof to Borrower so long no Default has occurred and is continuing. Borrower authorizes Administrative Agent to deduct from such insurance proceeds received by Administrative Agent all of Administrative Agent’s costs and expenses (including, without limitation, reasonable attorneys’ fees) incurred in connection with the collection thereof (the remainder of such insurance proceeds being referred to herein as “Net Casualty Proceeds.

(iii)    Administrative Agent shall cause the Net Casualty Proceeds from any casualty loss affecting the Mortgaged Property to be disbursed promptly for the cost of reconstruction of the Mortgaged Property if all of the following conditions are satisfied within ninety (90) days after the applicable casualty loss: (A) Borrower satisfies Administrative Agent that the reconstruction can be completed within a reasonable period of time after such casualty loss (but in no event later than the Maturity Date) and that after giving effect to such reconstruction the Mortgaged Property will be restored to its condition immediately prior to the casualty loss; (B) Borrower satisfies Administrative Agent that the Net Casualty Proceeds are sufficient to pay all costs of reconstruction, and if insufficient, Borrower deposits with Administrative Agent additional funds to make up such insufficiency; and (C) Borrower delivers to Administrative Agent all plans and specifications (if applicable) and construction contracts for the work of reconstruction and such plans and specifications (if applicable) and construction contracts are in form and content reasonably acceptable to Administrative Agent and with a contractor reasonably acceptable to Administrative Agent. The disbursement of Net Casualty Proceeds pursuant to this clause (iv) shall be in accordance with customary disbursement procedures and shall not be available after the occurrence and during the continuance of a Default. Any Net Casualty Proceeds not required to reconstruct the Mortgaged Property shall be delivered to Borrower after expiration of the lien period for the work of reconstruction (or, at Borrower’s option, after delivery of title insurance to Administrative Agent, for the benefit of the Lenders, over such liens where the lien period has not so expired). Upon the occurrence and during the continuance of a Default or in the event Borrower is unable to satisfy the conditions set forth in subclauses (A) through (C) hereof by the required date, Administrative Agent, on behalf of the Lenders, shall have the right (but not the obligation) to apply all Net Casualty Proceeds held by it to the payment of the Obligations. Borrower shall have the obligation to promptly and diligently complete the work of reconstruction necessitated by any casualty loss and restore the Mortgaged Property to the equivalent of its condition immediately prior to such casualty provided the applicable Net Casualty Proceeds are made available to Borrower for such purpose.

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7.02    Condemnation and Other Awards.

Promptly upon receiving written notice of the institution or threatened institution of any proceeding for the condemnation of the Mortgaged Property or any part thereof, Borrower shall notify Administrative Agent of such fact. Borrower shall then file or defend its rights thereunder and prosecute the same with due diligence to its final disposition; provided, however, that Borrower shall not enter into any settlement of such proceeding without the prior approval of Administrative Agent. Administrative Agent shall be entitled, at its option, to appear in any such proceeding in its own name, on behalf of the Lenders, and upon the occurrence and during the continuation of a Default or if Borrower fails to diligently prosecute such proceeding, (a) Administrative Agent shall be entitled, at its option, to appear in and prosecute any such proceeding or to make any compromise or settlement in connection with such condemnation on behalf of Borrower, and (b) Borrower hereby irrevocably constitutes and appoints Administrative Agent as its attorney-in-fact, and such appointment is coupled with an interest, to commence, appear in and prosecute such action or proceeding or to make such compromise or settlement in connection with any such condemnation on its behalf. The foregoing appointment is irrevocable and continuing so long as the Commitments or Obligations remain outstanding, and such rights, powers and privileges shall be exclusive in Administrative Agent (for the benefit of the Lenders), its successors and assigns. If the Mortgaged Property or any material part thereof is taken or materially diminished in value in connection with such condemnation, or if a consent settlement is entered, by or under threat of such proceeding, the award or settlement payable to Borrower by virtue of its interest in the Mortgaged Property, shall be, and by these presents is, assigned, transferred and set over unto Administrative Agent, for the benefit of the Lenders. Any such award or settlement shall be first applied to reimburse Administrative Agent and the Lenders for all costs and expenses, including reasonable attorneys’ fees, incurred in connection with the collection of such award or settlement. The balance of such award or settlement (the “Net Condemnation Proceeds”) shall be paid to Administrative Agent, for the benefit of the Lenders for application in the manner set forth in Section 7.01(g) as if such award or settlement constituted insurance proceeds from a casualty loss; provided, however, that Administrative Agent shall have no obligation to make Net Condemnation Proceeds available for construction or reconstruction of the Mortgaged Property unless Administrative Agent has determined that the Mortgaged Property as so constructed or reconstructed after giving effect to the condemnation would have a value that is no less than its value would have been had there been no such condemnation. Borrower shall have the obligation to promptly and diligently complete the work of reconstruction necessitated by any condemnation and restore the Mortgaged Property to the equivalent of its condition immediately prior to such condemnation (or if the initial construction of the Improvements is not substantially complete at the time of such condemnation, continue the construction of the Improvements in accordance with the terms hereof) provided the applicable Net Condemnation Proceeds are made available to Borrower for such purpose.

ARTICLE VIII

DEFAULTS

8.01    Defaults.

Any of the following events, after passage of the applicable cure period set forth below, shall constitute a “Default” hereunder:

(a)    Failure to Make Payment. The failure by Borrower to pay in full any principal of the Loans when due; the failure by Borrower to pay in full any interest on the Loans or any fees or any other amounts due under the Loan Documents (other than principal) when due and such failure continues unremedied for a period of five (5) days after the due date thereof; or the failure by Borrower to make any other payment or deposit required hereunder or under any of the other Loan Documents within the period set forth in Loan Documents, or if no period is set forth in the Loan Documents, then within five (5) Business Days after demand therefor;

(b)    Involuntary Proceeding. An involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization or other relief in respect of Borrower or any Guarantor or its debts, or of a substantial part of its assets, under any federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect or (ii) the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for Borrower or any Guarantor or for a substantial part of its assets, and, in any such case, such proceeding or petition shall continue undismissed for 90 days or an order or decree approving or ordering any of the foregoing shall be entered;

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(c)    Voluntary Proceedings. Borrower or any Guarantor shall (i) voluntarily commence any proceeding or file any petition seeking liquidation, reorganization or other relief under any Federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect, (ii) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in clause (b) of this Section, (iii) apply for or consent to the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for Borrower or any Guarantor or for a substantial part of its assets, (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding, (v) make a general assignment for the benefit of creditors or (vi) take any action for the purpose of effecting any of the foregoing;

(d)    Assignment for Benefit of Creditors. The execution by Borrower or Guarantor of an assignment for the benefit of creditors;

(e)    Unable to Pay Debts. The admission in writing by Borrower or Guarantor that it is unable to pay its debts as they mature or that it is generally not paying its debts as they mature;

(f)    Liquidation of Borrower or Guarantor. The liquidation, termination or dissolution of Borrower or Guarantor;

(g)    Transfer or Encumbrance of Interest in Mortgaged Property or Borrower.

(i)    Mortgaged Property. The sale, lease (except as permitted under this Agreement), exchange, conveyance, transfer, mortgage, assignment, pledge or encumbrance, either voluntarily or involuntarily, or the agreement to do so, of any right, title or interest of Borrower in and to the Mortgaged Property or any portion thereof, which occurrence is not rendered ineffective within ten (10) days after occurrence; provided, however, that Borrower shall be permitted to replace or dispose of defective, obsolete or worn out personal property, and Borrower shall be permitted to grant and/or record Permitted Encumbrances;

(ii)    Borrower. The sale, exchange, conveyance, transfer, mortgage, assignment, pledge or encumbrance, either voluntarily or involuntarily, or the agreement to do so, of any direct or indirect ownership interest in Borrower or any portion thereof; or any change (whether voluntary or involuntary) in the management or control of Borrower; or any division of Borrower (whether pursuant to a “plan of division” or other similar arrangement); provided, however, Borrower shall be permitted to make Permitted Transfers;

(h)    Levy; Attachment; Seizure. The levy, attachment or seizure pursuant to court order of (i) any right, title or interest of Borrower in and to the Mortgaged Property or any portion thereof or (ii) any direct or indirect ownership interests in Borrower, if such order is not vacated and the proceeding in which it was entered is not dismissed within thirty (30) days of the entry of such order;

(i)    Failure of Representations. Any representation or warranty contained herein or in any of the other Loan Documents, or in any certificate or other document executed by Borrower or Guarantor and delivered to Administrative Agent pursuant to or in connection with this Agreement, is not true and correct in all material respects, or omits to state a material fact necessary to make such representation not misleading, in each case, as of the date made or deemed made;

(j)    Claims; Liens; Encumbrances; Stop Notices. Unless Borrower is contesting the same in accordance with the provisions of Section 4.01(c) hereof, the filing of any claim of lien or encumbrance against the Mortgaged Property or any part thereof that is not released or insured over with a title insurance endorsement (obtained at Borrower’s cost and expense) within thirty (30) days after notice thereof from Administrative Agent to Borrower; or the service on Administrative Agent, any Lender or any disburser of funds of a notice or demand to withhold funds, which is not nullified within thirty (30) days after the date of such service;

(k)    Permits; Utilities; Insurance. (i) The neglect, failure or refusal of Borrower to keep in full force and effect any material permit, license, consent or approval required for the construction or operation of the Improvements that is not fully reinstated within thirty (30) days after Administrative Agent gives Borrower notice of

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the lapse of effectiveness of such material permit, license, consent or approval; or (ii) the curtailment in availability to the Mortgaged Property of utilities or other public services necessary for the full occupancy and utilization of the Improvements that is not restored to full availability within thirty (30) days after Administrative Agent gives Borrower notice of such curtailment of availability; or (iii) the failure by Borrower to maintain any insurance required under Section 7.01 hereof that is not cured within five (5) Business Days after Administrative Agent gives Borrower notice of such lapse;

(l)    Cessation of Loan Documents to be Effective. The cessation, for any reason, of any Loan Document to be in full force and effect in all material respects; the failure of any Lien intended to be created by the Loan Documents to exist or to be valid and perfected; the cessation of any such Lien, for any reason, to have the priority contemplated by this Agreement or the other Loan Documents, subject to Borrower’s right to contest liens in accordance with the terms of this Agreement; or the revocation by Guarantor of the Limited Guaranty or any other Loan Document executed by Guarantor;

(m)    ERISA. Any breach of the provisions of Section 4.11 hereof;

(n)    Prohibited Distributions. Any breach of the provisions of Section 4.06 hereof shall occur which is not cured by Borrower within ten (10) days after such breach;

(o)    Intentionally Omitted;

(p)    Operations of Borrower. Any breach of the provisions of Section 4.03 hereof shall occur which is not cured by Borrower within ten (10) days after Administrative Agent gives Borrower notice thereof;

(q)    Judgments. Any final, non-appealable judgment or order for the payment of money in excess of $250,000 is rendered against Borrower, and Borrower fails to paid such judgement or order within thirty (30) days of the date of thereof;

(r)    Intentionally Omitted;

(s)    Guarantor Financial Covenant. Guarantor shall be in breach of its financial covenants set forth in Section 10(c) of the Limited Guaranty, and such failure is not cured by Guarantor within thirty (30) days after such breach;

(t)    Intentionally Omitted.

(u)    Death of Individual Guarantor. Any Guarantor that is a natural person dies;

(v)    Swap Agreements. The occurrence or existence of any default, event of default or other similar condition or event (however described) with respect to any Swap Agreement, whether or not any Lender or Affiliate of any Lender is a party thereto;

(w)    Borrower Cross-Default. Failure by Borrower to pay when due any Indebtedness in an outstanding principal amount of $500,000 or more in the aggregate excluding the Loans (“Material Borrower Indebtedness”); or the default by Borrower in the performance (beyond the applicable grace period with respect thereto, if any) of any term, provision or condition contained in any loan agreement or other debt instrument, or any other event shall occur or condition exist, the effect of which default, event or condition is to cause, or permit the holder(s) of such Material Borrower Indebtedness to cause, such Material Borrower Indebtedness to become due prior to its stated maturity or any commitment to lend under any such loan agreement or other debt instrument to be terminated prior to its stated expiration date; or any Material Borrower Indebtedness shall be declared to be due and payable or required to be prepaid or repurchased (other than by a regularly scheduled payment) prior to the stated maturity thereof;

(x)    Anti-Corruption Laws and Sanctions. Any breach of the covenants set forth in Section 4.18 hereof; or

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(y)    Failure to Perform Covenants. The failure of Borrower to fully perform any and all covenants and agreements hereunder or under any of the other Loan Documents, and, with respect to covenants and agreements other than those specifically referenced in this Section 8.01, or for which another cure period is provided, such failure is not cured by Borrower within thirty (30) days after Administrative Agent gives notice to Borrower thereof; provided that, in the event that such failure cannot be remedied with reasonable diligence during such thirty (30) day period, such failure shall not constitute a Default so long as Borrower commences to cure such failure during such thirty (30) day period, and thereafter diligently prosecutes such cure to completion and completes such cure within an additional thirty (30) days period.

ARTICLE IX

ACCELERATION AND REMEDIES

9.01    Acceleration.

If any Default described in Section 8.01(b) or (c) hereof occurs with respect to Borrower, the obligations of the Lenders to make the Loans hereunder shall automatically terminate and the Obligations (other than Swap Obligations included therein) shall immediately become due and payable without any election or action on the part of Administrative Agent or any Lender. If any other Default occurs, the Required Lenders (or Administrative Agent with the consent of the Required Lenders) may terminate or suspend the obligations of the Lenders to make the Loans hereunder, or declare the Obligations (other than Swap Obligations included therein) to be due and payable, or both, whereupon the Obligations (other than Swap Obligations included therein) shall become immediately due and payable, without presentment, demand, protest or notice of any kind, all of which Borrower hereby expressly waives. If the Required Lenders (in their sole discretion) shall so direct, Administrative Agent shall, by notice to Borrower, rescind and annul such acceleration and/or termination. Rights and remedies with respect to the Swap Obligations are set forth in the Swap Agreements.

9.02    Other Remedies

In addition to any other rights and remedies granted to Administrative Agent and the Lenders in the Loan Documents, Administrative Agent on behalf of the Lenders may exercise all rights and remedies of a secured party under the New York Uniform Commercial Code or any other applicable law. Without limiting the generality of the foregoing, Administrative Agent, without demand of performance or other demand, presentment, protest, advertisement or notice of any kind (except any notice required by law referred to below) to or upon Borrower or any other Person (all and each of which demands, defenses, advertisements and notices are hereby waived), may in such circumstances forthwith collect, receive, appropriate and realize upon the Mortgaged Property, or any part thereof, or consent to the use by Borrower of any cash collateral arising in respect of the Mortgaged Property on such terms as Administrative Agent deems reasonable, and/or may forthwith sell, lease, assign give an option or options to purchase or otherwise dispose of and deliver, or acquire by credit bid on behalf of the Lenders, the Mortgaged Property or any part thereof (or contract to do any of the foregoing), in one or more parcels at public or private sale or sales, at any exchange, broker’s board or office of Administrative Agent or any Lender or elsewhere upon such terms and conditions as it may deem advisable and at such prices as it may deem best, for cash or on credit or for future delivery without assumption of any credit risk. Administrative Agent or any Lender shall have the right upon any such public sale or sales, and, to the extent permitted by law, upon any such private sale or sales, to purchase the whole or any part of the Mortgaged Property so sold, free of any right or equity of redemption in Borrower, which right or equity is hereby waived and released. Borrower further agrees, at Administrative Agent’s request, to assemble the Mortgaged Property and make it available to Administrative Agent at places which Administrative Agent shall reasonably select, whether at Borrower’s premises or elsewhere. Administrative Agent shall apply the net proceeds of any action taken by it pursuant to this Article IX, after deducting all reasonable costs and expenses of every kind incurred in connection therewith or incidental to the care or safekeeping of any of the Mortgaged Property or in any other way relating to the Mortgaged Property or the rights of Administrative Agent and the Lenders hereunder, including , without limitation, reasonable attorneys’ fees and disbursements, to the payment in whole or in part of the obligations of Borrower under the Loan Documents, in such order as Administrative Agent may elect, and only after such application and after the payment by Administrative Agent of any other amount required by any provision of law, including , without limitation, Section 9-615(a)(3) of the New York UCC, need Administrative Agent account for the surplus, if any, to Borrower. To the extent permitted by applicable law, Borrower waives all claims, damages and demands it may acquire against Administrative Agent or any Lender arising out of the exercise by them of any rights hereunder. If any notice of a proposed sale or other disposition of Mortgaged Property shall be required by law, such notice shall be deemed reasonable and proper if given at least 10 days before such sale or other disposition.

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9.03    Curing of Defaults.

Upon the occurrence of a Default hereunder, Administrative Agent without waiving any right of acceleration or foreclosure under the Loan Documents which Administrative Agent or the Lenders may have by reason of such Default or any other right Administrative Agent or the Lenders may have against Borrower because of said Default, shall have the right (but not the obligation) to take such actions and make such payments as shall be necessary to cure such Default, including, without limitation, the making of Advances. All amounts so expended shall constitute Obligations and shall be payable by Borrower on demand by Administrative Agent.

ARTICLE X

ADMINISTRATIVE AGENT

10.01    Authorization and Action.

(a)    Each Lender hereby irrevocably appoints the entity named as Administrative Agent in the heading of this Agreement and its successors and assigns to serve as the administrative agent and collateral agent under the Loan Documents and each Lender authorizes Administrative Agent to take such actions as agent on its behalf and to exercise such powers under this Agreement and the other Loan Documents as are delegated to Administrative Agent under such agreements and to exercise such powers as are reasonably incidental thereto. Without limiting the foregoing, each Lender hereby authorizes Administrative Agent to execute and deliver, and to perform its obligations under, each of the Loan Documents to which Administrative Agent is a party, and to exercise all rights, powers and remedies that Administrative Agent may have under such Loan Documents.

(b)    As to any matters not expressly provided for herein and in the other Loan Documents (including enforcement or collection), Administrative Agent shall not be required to exercise any discretion or take any action, but shall be required to act or to refrain from acting (and shall be fully protected in so acting or refraining from acting) upon the written instructions of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, pursuant to the terms in the Loan Documents), and, unless and until revoked in writing, such instructions shall be binding upon each Lender; provided, however, that Administrative Agent shall not be required to take any action that (i) Administrative Agent in good faith believes exposes it to liability unless Administrative Agent receives an indemnification and is exculpated in a manner satisfactory to it from the Lenders with respect to such action or (ii) is contrary to this Agreement or any other Loan Document or applicable law, including any action that may be in violation of the automatic stay under any requirement of law relating to bankruptcy, insolvency or reorganization or relief of debtors or that may effect a forfeiture, modification or termination of property of a Defaulting Lender in violation of any requirement of law relating to bankruptcy, insolvency or reorganization or relief of debtors; provided, further, that Administrative Agent may seek clarification or direction from the Required Lenders prior to the exercise of any such instructed action and may refrain from acting until such clarification or direction has been provided. Except as expressly set forth in the Loan Documents, Administrative Agent shall not have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to Borrower or any Affiliate of Borrower that is communicated to or obtained by the Person serving as Administrative Agent or any of its Affiliates in any capacity. Nothing in this Agreement shall require Administrative Agent to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder or in the exercise of any of its rights or powers if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.

(c)    In performing its functions and duties hereunder and under the other Loan Documents, Administrative Agent is acting solely on behalf of the Lenders (except in limited circumstances expressly provided for herein relating to the maintenance of the Register), and its duties are entirely mechanical and administrative in nature. Without limiting the generality of the foregoing:

(i)    Administrative Agent does not assume and shall not be deemed to have assumed any obligation or duty or any other relationship as the agent, fiduciary or trustee of or for any Lender or holder of any other obligation other than as expressly set forth herein and in the other Loan Documents,

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regardless of whether a Default has occurred and is continuing (and it is understood and agreed that the use of the term “agent” (or any similar term) herein or in any other Loan Document with reference to Administrative Agent is not intended to connote any fiduciary duty or other implied (or express) obligations arising under agency doctrine of any applicable law, and that such term is used as a matter of market custom and is intended to create or reflect only an administrative relationship between contracting parties); additionally, each Lender agrees that it will not assert any claim against Administrative Agent based on an alleged breach of fiduciary duty by Administrative Agent in connection with this Agreement and/or the transactions contemplated hereby;

(ii)    where Administrative Agent is required or deemed to act as a trustee in respect of any Collateral over which a security interest has been created pursuant to a Loan Document expressed to be governed by the laws of, or is required or deemed to hold any Collateral “on trust” pursuant to the foregoing, the obligations and liabilities of Administrative Agent to the Lenders in its capacity as trustee shall be excluded to the fullest extent permitted by applicable law and

(iii)    nothing in this Agreement or any Loan Document shall require Administrative Agent to account to any Lender for any sum or the profit element of any sum received by Administrative Agent for its own account.

(d)    Administrative Agent may perform any of its duties and exercise its rights and powers hereunder or under any other Loan Document by or through any one or more sub-agents appointed by Administrative Agent. Administrative Agent and any such sub-agent may perform any of their respective duties and exercise their respective rights and powers through their respective Related Parties. The exculpatory provisions of this Article shall apply to any such sub-agent and to the Related Parties of Administrative Agent and any such sub-agent, and shall apply to their respective activities pursuant to this Agreement. Administrative Agent shall not be responsible for the negligence or misconduct of any sub-agent except to the extent that a court of competent jurisdiction determines in a final and nonappealable judgment that Administrative Agent acted with gross negligence or willful misconduct in the selection of such sub-agent.

(e)    None of any Arranger shall have obligations or duties whatsoever in such capacity under this Agreement or any other Loan Document and shall incur no liability hereunder or thereunder in such capacity, but all such persons shall have the benefit of the indemnities provided for hereunder.

(f)    In case of the pendency of any proceeding with respect to Borrower or any Guarantor under any federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect, Administrative Agent (irrespective of whether the principal of any Loan or any reimbursement obligation shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether Administrative Agent shall have made any demand on Borrower) shall be entitled and empowered (but not obligated) by intervention in such proceeding or otherwise:

(i)    to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans and all other Obligations that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of the Lenders and Administrative Agent (including any claim under Sections 3.07, 3.08, 3.10, 3.12 and 11.03) allowed in such judicial proceeding; and

(ii)    to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same;

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such proceeding is hereby authorized by each Lender to make such payments to Administrative Agent and, in the event that Administrative Agent shall consent to the making of such payments directly to the Lenders, to pay to Administrative Agent any amount due to it, in its capacity as Administrative Agent, under the Loan Documents (including under Section 9.03). Nothing contained herein shall be deemed to authorize Administrative Agent to authorize or consent to or accept or adopt on behalf of any Lender any plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of any Lender or to authorize Administrative Agent to vote in respect of the claim of any Lender in any such proceeding.

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(g)    The provisions of this Article are solely for the benefit of Administrative Agent and the Lenders, and, except solely to the extent of Borrower’s rights to consent pursuant to and subject to the conditions set forth in this Article, none of Borrower, Guarantor or any of their respective Affiliates, shall have any rights as a third party beneficiary under any such provisions.

10.02    Administrative Agent’s Reliance, Indemnification, Etc.

(a)    Neither Administrative Agent nor any of its Related Parties shall be (i) liable to any Lender for any action taken or omitted to be taken by such party, Administrative Agent or any of its Related Parties under or in connection with this Agreement or the other Loan Documents (x) with the consent of or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or as Administrative Agent shall believe in good faith to be necessary, under the circumstances as provided in the Loan Documents) or (y) in the absence of its own gross negligence or willful misconduct (such absence to be presumed unless otherwise determined by a court of competent jurisdiction by a final and non-appealable judgment) or (ii) responsible in any manner to any of the Lenders for any recitals, statements, representations or warranties made by Borrower or any Guarantor or any officer thereof contained in this Agreement or any other Loan Document or in any certificate, report, statement or other document referred to or provided for in, or received by Administrative Agent under or in connection with, this Agreement or any other Loan Document or for the value, validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement or any other Loan Document or for any failure of Borrower or any Guarantor to perform its obligations hereunder or thereunder.

(b)    Administrative Agent shall be deemed not to have knowledge of any notice of Unmatured Default or Default unless and until written notice thereof (stating that it is a “notice of Unmatured Default” or “notice of Default”) is given to Administrative Agent by Borrower, or a Lender. Further, Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with any Loan Document, (ii) the contents of any certificate, report or other document delivered thereunder or in connection therewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth in any Loan Document or the occurrence of any Unmatured Default or Default, (iv) the sufficiency, validity, enforceability, effectiveness or genuineness of any Loan Document or any other agreement, instrument or document, (v) the satisfaction of any condition set forth in Article II or elsewhere in any Loan Document, other than to confirm receipt of items (which on their face purport to be such items) expressly required to be delivered to Administrative Agent or satisfaction of any condition that expressly refers to the matters described therein being acceptable or satisfactory to Administrative Agent, or (vi) the creation, perfection or priority of the Lien on the Mortgaged Property.

(c)    Without limiting the foregoing, Administrative Agent (i) may treat the payee of any promissory note as its holder until such promissory note has been assigned in accordance with Section 11.04, (ii) may rely on the Register to the extent set forth in Section 11.04 (iii) may consult with legal counsel (including counsel to Borrower), independent public accountants and other experts selected by it, and shall not be liable for any action taken or omitted to be taken in good faith by it in accordance with the advice of such counsel, accountants or experts, (iv) makes no warranty or representation to any Lender and shall not be responsible to any Lender for any statements, warranties or representations made by or on behalf of Borrower or any Guarantor in connection with this Agreement or any other Loan Document, (v) in determining compliance with any condition hereunder to the making of a Loan that by its terms must be fulfilled to the satisfaction of a Lender, may presume that such condition is satisfactory to such Lender unless Administrative Agent shall have received notice to the contrary from such Lender sufficiently in advance of the making of such Loan and (vi) shall be entitled to rely on, and shall incur no liability under or in respect of this Agreement or any other Loan Document by acting upon, any notice, consent, certificate or other instrument or writing (which writing may be a fax, any electronic message, Internet or intranet website posting or other distribution) or any statement made to it orally or by telephone and believed by it to be genuine and signed or sent or otherwise authenticated by the proper party or parties (whether or not such Person in fact meets the requirements set forth in the Loan Documents for being the maker thereof).

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10.03    Posting of Communications.

(a)    Borrower agrees that Administrative Agent may, but shall not be obligated to, make any Communications available to the Lenders by posting the Communications on IntraLinks^™, DebtDomain, SyndTrak, ClearPar or any other electronic platform chosen by Administrative Agent to be its electronic transmission system (the “Approved Electronic Platform”).

(b)    Although the Approved Electronic Platform and its primary web portal are secured with generally-applicable security procedures and policies implemented or modified by Administrative Agent from time to time (including, as of the Closing Date, a user ID/password authorization system) and the Approved Electronic Platform is secured through a per-deal authorization method whereby each user may access the Approved Electronic Platform only on a deal-by-deal basis, each of the Lenders and Borrower acknowledges and agrees that the distribution of material through an electronic medium is not necessarily secure, that Administrative Agent is not responsible for approving or vetting the representatives or contacts of any Lender that are added to the Approved Electronic Platform, and that there may be confidentiality and other risks associated with such distribution. Each of the Lenders and Borrower hereby approves distribution of the Communications through the Approved Electronic Platform and understands and assumes the risks of such distribution.

(c)    THE APPROVED ELECTRONIC PLATFORM AND THE COMMUNICATIONS ARE PROVIDED “AS IS” AND “AS AVAILABLE”. THE APPLICABLE PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE COMMUNICATIONS, OR THE ADEQUACY OF THE APPROVED ELECTRONIC PLATFORM AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS OR OMISSIONS IN THE APPROVED ELECTRONIC PLATFORM AND THE COMMUNICATIONS. NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY THE APPLICABLE PARTIES IN CONNECTION WITH THE COMMUNICATIONS OR THE APPROVED ELECTRONIC PLATFORM. IN NO EVENT SHALL ADMINISTRATIVE AGENT, ANY ARRANGER OR ANY OF THEIR RESPECTIVE RELATED PARTIES (COLLECTIVELY, “APPLICABLE PARTIES”) HAVE ANY LIABILITY TO BORROWER OR ANY GUARANTOR, ANY LENDER OR ANY OTHER PERSON OR ENTITY FOR DAMAGES OF ANY KIND, INCLUDING DIRECT OR INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES, LOSSES OR EXPENSES (WHETHER IN TORT, CONTRACT OR OTHERWISE) ARISING OUT OF BORROWER’S OR ANY GUARANTOR’S OR ADMINISTRATIVE AGENT’S TRANSMISSION OF COMMUNICATIONS THROUGH THE INTERNET OR THE APPROVED ELECTRONIC PLATFORM.

“Communications” means, collectively, any notice, demand, communication, information, document or other material provided by or on behalf of Borrower or any Guarantor pursuant to any Loan Document or the transactions contemplated therein which is distributed by Administrative Agent or any Lender by means of electronic communications pursuant to this Section, including through an Approved Electronic Platform.

(d)    Each Lender agrees that notice to it (as provided in the next sentence) specifying that Communications have been posted to the Approved Electronic Platform shall constitute effective delivery of the Communications to such Lender for purposes of the Loan Documents. Each Lender agrees (i) to notify Administrative Agent in writing (which could be in the form of electronic communication) from time to time of such Lender’s email address to which the foregoing notice may be sent by electronic transmission and (ii) that the foregoing notice may be sent to such email address.

(e)    Each of the Lenders and Borrower agrees that Administrative Agent may, but (except as may be required by applicable law) shall not be obligated to, store the Communications on the Approved Electronic Platform in accordance with Administrative Agent’s generally applicable document retention procedures and policies.

(f)    Nothing herein shall prejudice the right of Administrative Agent or any Lender to give any notice or other communication pursuant to any Loan Document in any other manner specified in such Loan Document.

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10.04    Administrative Agent Individually.

With respect to its Commitment and Loans, the Person serving as Administrative Agent shall have and may exercise the same rights and powers hereunder and is subject to the same obligations and liabilities as and to the extent set forth herein for any other Lender. The terms “Lenders”, “Required Lenders” and any similar terms shall, unless the context clearly otherwise indicates, include Administrative Agent in its individual capacity as a Lender or as one of the Required Lenders, as applicable. The Person serving as Administrative Agent and its Affiliates may accept deposits from, lend money to, own securities of, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of banking, trust or other business with, Borrower, any Guarantor or any Affiliate of any of the foregoing as if such Person was not acting as Administrative Agent and without any duty to account therefor to the Lenders.

10.05    Successor Administrative Agent.

(a)    Administrative Agent may resign at any time by giving 60 days’ prior written notice thereof to the Lenders and Borrower, whether or not a successor Administrative Agent has been appointed. Upon any such resignation, the Required Lenders shall have the right to appoint a successor Administrative Agent. If no successor Administrative Agent shall have been so appointed by the Required Lenders, and shall have accepted such appointment, within 30 days after the retiring Administrative Agent’s giving of notice of resignation, then the retiring Administrative Agent may, on behalf of the Lenders, appoint a successor Administrative Agent, which shall be a bank with an office in New York, New York or an Affiliate of any such bank. In either case, such appointment shall be subject to the prior written approval of Borrower (which approval may not be unreasonably withheld and shall not be required while a Default has occurred and is continuing). Upon the acceptance of any appointment as Administrative Agent by a successor Administrative Agent, such successor Administrative Agent shall succeed to, and become vested with, all the rights, powers, privileges and duties of the retiring Administrative Agent. Upon the acceptance of appointment as Administrative Agent by a successor Administrative Agent, the retiring Administrative Agent shall be discharged from its duties and obligations under this Agreement and the other Loan Documents. Prior to any retiring Administrative Agent’s resignation hereunder as Administrative Agent, the retiring Administrative Agent shall take such action as may be reasonably necessary to assign to the successor Administrative Agent its rights as Administrative Agent under the Loan Documents.

(b)    Notwithstanding paragraph (a) of this Section, in the event no successor Administrative Agent shall have been so appointed and shall have accepted such appointment within 30 days after the retiring Administrative Agent gives notice of its intent to resign, the retiring Administrative Agent may give notice of the effectiveness of its resignation to the Lenders and Borrower, whereupon, on the date of effectiveness of such resignation stated in such notice, (i) the retiring Administrative Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents; provided that, solely for purposes of maintaining any security interest granted to Administrative Agent under any Loan Document for the benefit of the Lenders, the retiring Administrative Agent shall continue to be vested with such security interest as collateral agent for the benefit of the Lenders, and continue to be entitled to the rights set forth in such Loan Document, and, in the case of any collateral in the possession of Administrative Agent, shall continue to hold such collateral, in each case until such time as a successor Administrative Agent is appointed and accepts such appointment in accordance with this Section (it being understood and agreed that the retiring Administrative Agent shall have no duty or obligation to take any further action under any Loan Document, including any action required to maintain the perfection of any such security interest), and (ii) the Required Lenders shall succeed to and become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent; provided that (A) all payments required to be made hereunder or under any other Loan Document to Administrative Agent for the account of any Person other than Administrative Agent shall be made directly to such Person and (B) all notices and other communications required or contemplated to be given or made to Administrative Agent shall directly be given or made to each Lender. Following the effectiveness of Administrative Agent’s resignation from its capacity as such, the provisions of this Article and Section 11.03, as well as any exculpatory, reimbursement and indemnification provisions set forth in any other Loan Document, shall continue in effect for the benefit of such retiring Administrative Agent, its sub-agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while the retiring Administrative Agent was acting as Administrative Agent and in respect of the matters referred to in the proviso under clause (i) above.

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10.06    Acknowledgements of Lenders.

(a)    Each Lender represents that it is engaged in making, acquiring or holding commercial loans in the ordinary course of its business and that it has, independently and without reliance upon Administrative Agent, any Arranger, or any other Lender, or any of the Related Parties of any of the foregoing, and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement as a Lender, and to make, acquire or hold Loans hereunder. Each Lender also acknowledges that it will, independently and without reliance upon Administrative Agent, any Arranger, or any other Lender, or any of the Related Parties of any of the foregoing, and based on such documents and information (which may contain material, non-public information within the meaning of the United States securities laws concerning Borrower and its Affiliates) as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any other Loan Document or any related agreement or any document furnished hereunder or thereunder.

(b)    Each Lender, by delivering its signature page to this Agreement on the Closing Date, or delivering its signature page to an Assignment and Assumption or any other Loan Document pursuant to which it shall become a Lender hereunder, shall be deemed to have acknowledged receipt of, and consented to and approved, each Loan Document and each other document required to be delivered to, or be approved by or satisfactory to, Administrative Agent or the Lenders on the Closing Date.

10.07    Collateral Matters.

(a)    Except with respect to the exercise of setoff rights in accordance with Section 10.08 or with respect to a Lender’s right to file a proof of claim in an insolvency proceeding, no Lender shall have any right individually to realize upon any collateral or enforce any part of this Agreement, the other Loan Documents or the Required Third Party Documents with respect to the Obligations, it being understood and agreed that all powers, rights and remedies under the Loan Documents may be exercised solely by Administrative Agent on behalf of the Lenders in accordance with the terms thereof. In its capacity, Administrative Agent is a “representative” of the Lenders within the meaning of the term “secured party” as defined in the UCC. In the event that any collateral is hereafter pledged by any Person as collateral security for the Obligations, Administrative Agent is hereby authorized, and hereby granted a power of attorney, to execute and deliver on behalf of the Lenders any Loan Documents necessary or appropriate to grant and perfect a Lien on such collateral in favor of Administrative Agent on behalf of the Lenders. With respect to any action by Administrative Agent to enforce the rights and remedies of Administrative Agent and the Lenders under this Agreement and the other Loan Documents, each Lender hereby consents to the jurisdiction of the court in which such action is maintained, and agrees to deliver its Note to Administrative Agent to the extent necessary to enforce the rights and remedies of Administrative Agent for the benefit of the Lenders under the Mortgage in accordance with the provisions hereof. Each Lender agrees to indemnify each of the other Lenders for any loss or damage suffered or cost incurred by such other Lender (including without limitation, attorneys’ fees and expenses and other costs of defense) as a result of the breach of this Section 10.07 by such Lender.

(b)    The Lenders irrevocably authorize Administrative Agent, at its option and in its discretion, to subordinate any Lien on any property granted to or held by Administrative Agent under any Loan Document to any Permitted Encumbrance. Administrative Agent shall not be responsible for or have a duty to ascertain or inquire into any representation or warranty regarding the existence, value or collectability of the collateral, the existence, priority or perfection of Administrative Agent’s Lien thereon or any certificate prepared by Borrower or any Guarantor in connection therewith, nor shall Administrative Agent be responsible or liable to the Lenders for any failure to monitor or maintain any portion of the collateral.

10.08    Credit Bidding.

The Lenders hereby irrevocably authorize Administrative Agent, at the direction of the Required Lenders, to credit bid all or any portion of the Obligations (including by accepting some or all of the collateral in satisfaction of some or all of the Obligations pursuant to a deed in lieu of foreclosure or otherwise) and in such manner purchase (either directly or through one or more acquisition vehicles) all or any portion of the collateral (a) at any sale thereof conducted under the provisions of the United States Bankruptcy Code, including under Sections 363, 1123 or 1129 of the United States Bankruptcy Code, or any Debtor Relief Laws, or (b) at any other sale, foreclosure or acceptance of collateral in lieu of debt conducted by (or with the consent or at the direction of) Administrative Agent (whether by judicial action or otherwise) in accordance with any applicable law. In connection with any such credit

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bid and purchase, the Obligations owed to the Lenders shall be entitled to be, and shall be, credit bid by Administrative Agent at the direction of the Required Lenders on a ratable basis (with Obligations with respect to contingent or unliquidated claims receiving contingent interests in the acquired assets on a ratable basis that shall vest upon the liquidation of such claims in an amount proportional to the liquidated portion of the contingent claim amount used in allocating the contingent interests) for the asset or assets so purchased (or for the equity interests or debt instruments of the acquisition vehicle or vehicles that are issued in connection with such purchase). In connection with any such bid, (i) Administrative Agent shall be authorized to form one or more acquisition vehicles and to assign any successful credit bid to such acquisition vehicle or vehicles, (ii) each of the Lenders’ ratable interests in the Obligations which were credit bid shall be deemed without any further action under this Agreement to be assigned to such vehicle or vehicles for the purpose of closing such sale, (iii) Administrative Agent shall be authorized to adopt documents providing for the governance of the acquisition vehicle or vehicles (provided that any actions by Administrative Agent with respect to such acquisition vehicle or vehicles, including any disposition of the assets or equity interests thereof, shall be governed, directly or indirectly, by, and the governing documents shall provide for, control by the vote of the Required Lenders or their permitted assignees under the terms of this Agreement or the governing documents of the applicable acquisition vehicle or vehicles, as the case may be, irrespective of the termination of this Agreement and without giving effect to the limitations on actions by the Required Lenders contained in Section 11.02 of this Agreement), (iv) Administrative Agent on behalf of such acquisition vehicle or vehicles shall be authorized to issue to each of the Lenders, ratably on account of the relevant Obligations which were credit bid, interests, whether as equity, partnership, interests, limited partnership interests or membership interests, in any such acquisition vehicle and/or debt instruments issued by such acquisition vehicle, all without the need for any Lender or acquisition vehicle to take any further action, and (v) to the extent that Obligations that are assigned to an acquisition vehicle are not used to acquire collateral for any reason (as a result of another bid being higher or better, because the amount of Obligations assigned to the acquisition vehicle exceeds the amount of Obligations credit bid by the acquisition vehicle or otherwise), such Obligations shall automatically be reassigned to the Lenders pro rata with their original interest in such Obligations and the equity interests and/or debt instruments issued by any acquisition vehicle on account of such Obligations shall automatically be cancelled, without the need for any Lender or any acquisition vehicle to take any further action. Notwithstanding that the ratable portion of the Obligations of each Lender is deemed assigned to the acquisition vehicle or vehicles as set forth in clause (ii) above, each Lender shall execute such documents and provide such information regarding the Lender (and/or any designee of the Lender which will receive interests in or debt instruments issued by such acquisition vehicle) as Administrative Agent may reasonably request in connection with the formation of any acquisition vehicle, the formulation or submission of any credit bid or the consummation of the transactions contemplated by such credit bid.

10.09    Lender Reply Period.

Except as otherwise provided in this Agreement, all communications from Administrative Agent to Lenders requesting Lenders’ determination, consent or approval (i) shall be given in the form of a written notice to each Lender, (ii) shall be accompanied by a description of the matter as to which such determination, consent or approval is requested, (iii) shall include a legend substantially as follows, printed in capital letters or boldface type:

“THIS COMMUNICATION REQUIRES IMMEDIATE RESPONSE. FAILURE TO RESPOND WITHIN TEN (10) BUSINESS DAYS AFTER THE DELIVERY OF THIS COMMUNICATION SHALL CONSTITUTE A DEEMED APPROVAL BY THE ADDRESSEE OF THE MATTER DESCRIBED ABOVE.”

and (iv) shall include Administrative Agent’s recommended course of action or determination in respect thereof. Each Lender shall reply promptly to any such request, but in any event within ten (10) Business Days after the delivery of such request by Administrative Agent (the “Lender Reply Period”). Unless a Lender shall give written notice to Administrative Agent that it objects to the recommendation or determination of Administrative Agent (together with a written explanation of the reasons behind such objection) within the Lender Reply Period, such Lender shall be deemed to have approved of or consented to such recommendation or determination. With respect to decisions requiring the approval of the Required Lenders or all Lenders, Administrative Agent shall timely submit any required written notices to all Lenders and upon receiving the required approval or consent shall follow the course of action or determination recommended by Administrative Agent or such other course of action recommended by the Required Lenders or all of the Lenders, as the case may be, and each non-responding Lender shall be deemed to have concurred with such recommended course of action.

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10.10    Foreclosure.

In the event that all or any portion of the Mortgaged Property is acquired by Administrative Agent as the result of a foreclosure or acceptance of a deed or assignment in lieu of foreclosure, or is retained in satisfaction of all or any part of the Obligations, title to any such Mortgaged Property or any portion thereof shall be held in the name of Administrative Agent or a nominee or subsidiary of Administrative Agent, as agent, for the benefit of the Lenders, or in an entity co-owned by the Lenders as determined by Administrative Agent. Administrative Agent shall prepare a recommended course of action for such Mortgaged Property (the “Post-Foreclosure Plan”) and submit it to the Lenders for approval by the Required Lenders. In the event that Administrative Agent does not obtain the approval of the Required Lenders to such Post-Foreclosure Plan, any Lender shall be permitted to submit an alternative Post-Foreclosure Plan to Administrative Agent, and Administrative Agent shall submit any and all such additional Post-Foreclosure Plan(s) to the Lenders for evaluation and the approval by the Required Lenders. In accordance with the approved Post-Foreclosure Plan, Administrative Agent shall manage, operate, repair, administer, complete, construct, restore or otherwise deal with the Mortgaged Property acquired and administer all transactions relating thereto, including, without limitation, employing a management agent, leasing agent and other agents, contractors and employees, including agents for the sale of such Mortgaged Property, and the collecting of rents and other sums from such Mortgaged Property and paying the expenses of such Mortgaged Property. Upon demand therefor from time to time, each Lender will contribute its ratable share (based on their respective Commitments immediately prior to the termination thereof) of all reasonable costs and expenses incurred by Administrative Agent pursuant to the Post-Foreclosure Plan in connection with the construction, operation, management, maintenance, leasing and sale of the Mortgaged Property. In addition, Administrative Agent shall render or cause to be rendered by the managing agent, to each of the Lenders, monthly, an income and expense statement for such Mortgaged Property, and each of the Lenders shall promptly contribute its ratable share (based on their respective Commitments immediately prior to the termination thereof) of any operating loss for the Mortgaged Property, and such other expenses and operating reserves as Administrative Agent shall deem reasonably necessary pursuant to and in accordance with the Post-Foreclosure Plan. To the extent there is net operating income from such Mortgaged Property, Administrative Agent shall, in accordance with the Post-Foreclosure Plan, determine the amount and timing of distributions to the Lenders. All such distributions shall be made to the Lenders in proportion to their respective Commitments immediately prior to the termination thereof. The Lenders acknowledge that if title to any Mortgaged Property is obtained by Administrative Agent or its nominee, or an entity co-owned by the Lenders, such Mortgaged Property will not be held as a permanent investment but will be disposed of as soon as practicable and within a time period consistent with the regulations applicable to national banks for owning real estate. Administrative Agent shall undertake to sell such Mortgaged Property at such price and upon such terms and conditions as the Required Lenders shall reasonably determine to be most advantageous. Any purchase money mortgage or deed of trust taken in connection with the disposition of such Mortgaged Property in accordance with the immediately preceding sentence shall name Administrative Agent, as agent for the Lenders, as the beneficiary or mortgagee. In such case, Administrative Agent and the Lenders shall enter into an agreement with respect to such purchase money mortgage defining the rights of the Lenders in the same, which agreement shall be in all material respects similar to the rights of the Lenders with respect to the Mortgaged Property. Lenders agree not to unreasonably withhold or delay their approval of a Post-Foreclosure Plan or any third party offer to purchase the Mortgaged Property. An offer to purchase the Mortgaged Property at a gross purchase price of 95% of the fair market value of the property as set forth in a current appraisal, shall be deemed to be a reasonable offer.

10.11    Certain ERISA Matters.

(a)    Each Lender (x) represents and warrants, as of the date such Person became a Lender party hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of, Administrative Agent, and each Arranger and their respective Affiliates, and not, for the avoidance of doubt, to or for the benefit of Borrower or any Guarantor, that at least one of the following is and will be true:

(i)    such Lender is not using “plan assets” (within the meaning of the Plan Asset Regulations) of one or more Benefit Plans in connection with the Loans or the Commitments,

(ii)    the transaction exemption set forth in one or more PTEs, such as PTE 84-14 (a class exemption for certain transactions determined by independent qualified professional asset managers), PTE 95-60 (a class exemption for certain transactions involving insurance company general accounts),

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PTE 90-1 (a class exemption for certain transactions involving insurance company pooled separate accounts), PTE 91-38 (a class exemption for certain transactions involving bank collective investment funds) or PTE 96-23 (a class exemption for certain transactions determined by in-house asset managers), is applicable with respect to such Lender’s entrance into, participation in, administration of and performance of the Loans, the Commitments and this Agreement,

(iii)    (A) such Lender is an investment fund managed by a “Qualified Professional Asset Manager” (within the meaning of Part VI of PTE 84-14), (B) such Qualified Professional Asset Manager made the investment decision on behalf of such Lender to enter into, participate in, administer and perform the Loans, the Commitments and this Agreement, (C) the entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement satisfies the requirements of sub-sections (b) through (g) of Part I of PTE 84-14 and (D) to the best knowledge of such Lender, the requirements of subsection (a) of Part I of PTE 84-14 are satisfied with respect to such Lender’s entrance into, participation in, administration of and performance of the Loans, the Commitments and this Agreement, or

(iv)    such other representation, warranty and covenant as may be agreed in writing between Administrative Agent, in its sole discretion, and such Lender.

(b)    In addition, unless sub-clause (i) in the immediately preceding clause (a) is true with respect to a Lender or such Lender has provided another representation, warranty and covenant as provided in sub-clause (iv) in the immediately preceding clause (a), such Lender further (x) represents and warrants, as of the date such Person became a Lender party hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of, Administrative Agent, and each Arranger and their respective Affiliates, and not, for the avoidance of doubt, to or for the benefit of Borrower or any Guarantor, that none of Administrative Agent, or any Arranger or any of their respective Affiliates is a fiduciary with respect to the Collateral or the assets of such Lender (including in connection with the reservation or exercise of any rights by Administrative Agent under this Agreement, any Loan Document or any documents related hereto or thereto).

(c)    Administrative Agent and each Arranger hereby informs the Lenders that each such Person is not undertaking to provide impartial investment advice, or to give advice in a fiduciary capacity, in connection with the transactions contemplated hereby, and that such Person has a financial interest in the transactions contemplated hereby in that such Person or an Affiliate thereof (i) may receive interest or other payments with respect to the Loans, the Commitments, this Agreement and any other Loan Documents, (ii) may recognize a gain if it extended the Loans or the Commitments for an amount less than the amount being paid for an interest in the Loans or the Commitments by such Lender or (iii) may receive fees or other payments in connection with the transactions contemplated hereby, the Loan Documents or otherwise, including structuring fees, commitment fees, arrangement fees, facility fees, upfront fees, underwriting fees, ticking fees, agency fees, administrative agent or collateral agent fees, utilization fees, minimum usage fees, letter of credit fees, fronting fees, deal-away or alternate transaction fees, amendment fees, processing fees, term out premiums, banker’s acceptance fees, breakage or other early termination fees or fees similar to the foregoing.

10.12    Compliance with Flood Laws.

Administrative Agent has adopted internal policies and procedures that address requirements placed on federally regulated lenders under the Flood Laws and will post on the applicable Platform (or otherwise distribute to each Lender documents that it receives in connection with the Flood Laws (“Flood Documents”); provided, however that Administrative Agent makes no representation or warranty with respect to the adequacy of the Flood Documents or their compliance with the Flood Laws. Each Lender acknowledges and agrees that it is individually responsible for its own compliance with the Flood Laws and that it shall, independently and without reliance upon Administrative Agent or any other Lender and based on such documents and information as it shall from time to time deem appropriate, including the Flood Documents posted or distributed by Administrative Agent, continue to do its own due diligence to ensure its compliance with the Flood Laws.

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ARTICLE XI

MISCELLANEOUS

11.01    Notices.

(a)    Generally. Except in the case of notices and other communications expressly permitted or required to be given by electronic communication (and subject to paragraph (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopy, as follows:

(i)    if to Borrower, to it at KRE JAG One Upland Owner LLC, c/o Cottonwood Communities, Inc., 6340 South 3000 East, Suite 500, Salt Lake City, Utah 84121, Attention: Gregg T. Christensen and Adam Larson (Telecopy No. 801.278.0756) (Email Addresses: gchristensen@cottonwoodres.com and alarson@cottonwoodres.com), with a copy to Brownstein Hyatt Farber Schreck, 410 Seventeenth Street, Denver, Colorado 80202, Attention: Amy J. Diaz, Esq. (Telecopy No. (303) 223-8034) (Email Address: adiaz@bhfs.com).

(ii)    if to Administrative Agent, to it at JPMorgan Chase Bank, N.A., 700 N Pearl Street, 13th Floor, Dallas, Texas 75201, Attention of Disbursements/Loan Servicing (Telecopy No. (214) 965-3320) (Email Address: craig.cousins@jpmorgan.com; with a copy to Morgan, Lewis & Bockius LLP, One Federal Street, Boston, Massachusetts 02110, Attention of Maurice H. Sullivan, III (Telecopy No. (617) 341-7701) (Email Address: skip.sullivan@morganlewis.com); and

(iii)    if to any other Lender, to it at its address (or telecopy number or email address) set forth in its Administrative Questionnaire.

Notices sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices sent by facsimile shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next business day for the recipient). Notices delivered through Approved Electronic Platforms, to the extent provided in paragraph (b) below, shall be effective as provided in said paragraph (b).

(b)    Electronic Notices. Notices and other communications to the Lenders hereunder may be delivered or furnished by using Approved Electronic Platforms pursuant to procedures approved by Administrative Agent; provided that the foregoing shall not apply to notices for interest rate elections and advances unless otherwise agreed by Administrative Agent and the applicable Lender. Either Administrative Agent or Borrower may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications.

(c)    Deemed Receipt. Unless Administrative Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement), and (ii) notices or communications posted to an Internet or intranet website shall be deemed received upon the receipt by the intended recipient, at its e-mail address as described in the foregoing clause (i), of notification that such notice or communication is available and identifying the website address therefor, provided that, for both clauses (i) and (ii) above, if such notice, email or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next business day of the recipient.

(d)    Changes in Address. Any party hereto may change its address or telecopy number or email address for notices and other communications hereunder by notice to the other parties hereto.

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11.02    Waivers; Amendments.

(a)    No Deemed Waivers; Remedies Cumulative. No failure or delay by Administrative Agent or any Lender in exercising any right or power hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of Administrative Agent and the Lenders hereunder are cumulative and are not exclusive of any rights or remedies that they would otherwise have. No waiver of any provision of this Agreement or consent to any departure by Borrower therefrom shall in any event be effective unless the same shall be permitted by Section 11.02(b) hereof, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. Without limiting the generality of the foregoing, the making of a Loan shall not be construed as a waiver of any Default or Unmatured Default, regardless of whether Administrative Agent or any Lender may have had notice or knowledge of such Default or Unmatured Default at the time.

(b)    Waivers and Amendments. Subject to Section 3.09(b) and (c) and Section 11.02(c) below, no provision of this Agreement or any other Loan Document or any Required Third Party Document may be waived, amended or modified except pursuant to an agreement or agreements in writing entered into by Borrower and the Required Lenders or by Borrower and Administrative Agent with the consent of the Required Lenders; provided that no such agreement shall (i) increase the Commitment of any Lender without the written consent of such Lender (including any such Lender that is a Defaulting Lender), (ii) reduce the principal amount of any Loan or reduce the rate of interest thereon, or reduce any fees payable hereunder, without the written consent of each Lender affected thereby (including any such Lender that is a Defaulting Lender), (iii) postpone the scheduled date of payment of the principal amount of any Loan or any interest thereon, or any fees payable hereunder, or reduce the amount of, waive or excuse any such payment, without the written consent of each Lender (including any such Lender that is a Defaulting Lender) affected thereby, (iv) change Section 3.13(b) or (c) in a manner that would alter the pro rata sharing of payments required thereby, without the written consent of each Lender (including any such Lender that is a Defaulting Lender), (v) change any of the provisions of this Section or the definition of “Required Lenders” or any other provision hereof specifying the number or percentage of Lenders required to waive, amend or modify any rights hereunder or make any determination or grant any consent hereunder, without the written consent of each Lender (including any such Lender that is a Defaulting Lender) directly affected thereby, (vi) release Guarantor from any of its obligations under the Loan Documents or release all or substantially all of the Mortgaged Property from the lien of the Loan Documents, without the written consent of each Lender (other than any Defaulting Lender), or (vii) permit an assignment by Borrower of any rights or obligations under the Loan Documents, without the written consent of each Lender (other than a Defaulting Lender); provided further that no such agreement shall amend, modify or otherwise affect the rights or duties of Administrative Agent hereunder without the prior written consent of Administrative Agent.

(c)    Actions by Administrative Agent; Required Consents. Each Lender authorizes Administrative Agent to enter into the Loan Documents (other than this Agreement) and the Required Third Party Documents on behalf of, and for the benefit of, the Lenders and to take all actions left to the discretion of Administrative Agent herein and therein on behalf of, and for the benefit of, the Lenders. If Administrative Agent and Borrower acting together identify any ambiguity, omission, mistake, typographical error or other defect in any provision of this Agreement or any other Loan Document, then Administrative Agent and Borrower shall be permitted to amend, modify or supplement such provision to cure such ambiguity, omission, mistake, typographical error or other defect, and such amendment shall become effective without any further action or consent of any other parties to this Agreement. Each Lender agrees that any action taken by Administrative Agent at the direction of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as provided in this Agreement), and any action taken by Administrative Agent not requiring consent by the Required Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as provided in this Agreement) shall be authorized by and binding upon all Lenders. Notwithstanding the foregoing provisions of this Section 11.02(c), Administrative Agent shall not have the authority to bind the Lenders with respect to any of the following matters without Administrative Agent obtaining the prior written consent of the Required Lenders:

(i)    any change in the identity of the Property Manager;

(ii)    the determination as to whether an Appraisal will be required pursuant to Section 3.15(a)(iv) or Section 3.15(b)(v) hereof;

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(iii)    Intentionally Omitted;

(iv)    Intentionally Omitted;

(v)    Intentionally Omitted;

(vi)    Intentionally Omitted;

(vii)    the approval of any material amendment, modification, substitution or replacement of the Property Management Agreement;

(viii)    the approval of any action described in Section 4.03(a)(iii) hereof;

(ix)    the exercise of any rights and remedies against Borrower, Guarantor or the Mortgaged Property; provided, however, that Administrative Agent may, in its discretion but without obligation, in the absence of direction from the Required Lenders, take such interim action as it believes necessary to preserve the rights of the Lenders hereunder in and to the Mortgaged Property, including, without limitation, (A) the delivery of default notices to Borrower or any other Person, (B) petitioning a court for injunctive relief, the appointment of a receiver or preservation of the proceeds of any collateral, (C) the making of Advances for the payment of interest, and (D) the exercise of the cure rights of Administrative Agent under this Agreement, the other Loan Documents and the Required Third Party Documents; and

(x)    the expenditure of funds by Administrative Agent for which the Lenders are responsible under Section 11.03 hereof to cure Defaults not in excess of Five Hundred Thousand Dollars ($500,000) in the aggregate; provided, however, that expenditures to pay any of the following items shall not be subject to the foregoing limitation in amount: (A) real estate taxes, assessments, charges and levies owing with respect to the Mortgaged Property, (B) insurance premiums owing with respect to insurance coverage required by the Loan Documents, (C) claims of lienholders with priority over the lien of the Mortgage, (D) expenditures necessary to respond to emergency conditions with respect to the Mortgaged Property, and (E) expenditures necessary to preserve the validity and priority of the lien of the Mortgage.

11.03    Expenses; Indemnity; Damage Waiver.

(a)    Expenses. Borrower shall pay (i) all reasonable out-of-pocket expenses incurred by Administrative Agent and its Affiliates, including appraisal fees, inspection fees, Inspecting Professional charges, title and escrow charges, the cost of any Approved Electronic Platform, and the reasonable fees, charges and disbursements of counsel for Administrative Agent in connection with the syndication of the credit facilities provided for herein (such syndication fees, charges and disbursements for which Borrower is responsible not to exceed $50,000 unless approved by Borrower or incurred pursuant to Section 3.17), the preparation and administration of this Agreement, the other Loan Documents and any Required Third Party Documents or any extensions, amendments, modifications or waivers of the provisions hereof or thereof (whether or not the transactions contemplated hereby or thereby shall be consummated), and (ii) all out-of-pocket expenses incurred by Administrative Agent or any Lender, including the fees, charges and disbursements of any counsel for Administrative Agent or any Lender, in connection with the enforcement or protection of its rights in connection with this Agreement and the other Loan Documents, including its rights under this Section, or in connection with the Loans made hereunder, including all such out-of-pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans.

(b)    Borrower Indemnity. Borrower shall indemnify Administrative Agent, each Arranger, each Lender and each Related Party of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, judgments, liabilities and related expenses, including the fees, charges and disbursements of any counsel for any Indemnitee (collectively, “Losses”), incurred by or asserted against any Indemnitee arising out of, in connection with, or as a result of (i) the execution or delivery of this Agreement, any other Loan Document or any agreement or instrument contemplated hereby, the performance by the parties hereto of their respective obligations hereunder or thereunder or the consummation of the Transactions or any other transactions contemplated hereby, (ii) any Loan or the use of the

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proceeds therefrom, or (iii) any actual or prospective claim, litigation, investigation, arbitration or proceeding relating to any of the foregoing, whether or not such claim, litigation, investigation, arbitration or proceeding is brought by Borrower or any Guarantor or any of their respective equity holders, Affiliates, creditors or any other third person and whether based on contract, tort or any other theory and regardless of whether any Indemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such Losses are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Indemnitee. The foregoing indemnity set forth in this Section 11.03(b) shall not apply (i) with respect to Taxes other than any Taxes that represent losses, claims or damages arising from any non-Tax claim and (ii) to any Losses, which are the subject of the Environmental Indemnity Agreement, it being the intention of the parties hereto that Borrower’s liability for environmental matters be governed exclusively by the Environmental Indemnity Agreement and not by this Agreement.

(c)    Indemnification by Lenders. Each Lender severally agrees to pay any amount required to be paid by Borrower or any Guarantor under paragraph (a) or (b) of this Section 11.03 to Administrative Agent and any Related Party of Administrative Agent (each, an “Agent Indemnitee”) (to the extent not reimbursed by Borrower or any Guarantor and without limiting the obligation of any Loan Party to do so), ratably according to their respective Applicable Percentages in effect on the date on which indemnification is sought under this Section (or, if indemnification is sought after the date upon which the Commitments shall have terminated and the Loans shall have been paid in full, ratably in accordance with such Applicable Percentage immediately prior to such date), from and against any and all losses, claims, damages, liabilities and related expenses, including the fees, charges and disbursements of any kind whatsoever that may at any time (whether before or after the payment of the Loans) be imposed on, incurred by or asserted against such Agent Indemnitee in any way relating to or arising out of the Commitments, this Agreement, any of the other Loan Documents or any documents contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby or any action taken or omitted by such Agent Indemnitee under or in connection with any of the foregoing; provided that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against such Agent Indemnitee in its capacity as such; provided further that no Lender shall be liable for the payment of any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements that are found by a final and nonappealable decision of a court of competent jurisdiction to have resulted from such Agent Indemnitee’s gross negligence or willful misconduct. The agreements in this Section shall survive the termination of this Agreement and the payment in full of the Obligations.

(d)    Damage Waiver. To the extent permitted by applicable law, (i) Borrower shall not assert, and Borrower hereby waives, any claim against any Indemnitee for any damages arising from the use by others of information or other materials obtained through telecommunications, electronic or other information transmission systems (including the Internet), and (ii) no party hereto shall assert, and each such party hereby waives, any claim against any other party hereto, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Loan Document (other than the Environmental Indemnity Agreement) or any agreement or instrument contemplated hereby or thereby, the Transactions, any Loan or the use of the proceeds thereof; provided that, nothing in this clause (d)(ii) shall relieve Borrower of any obligation it may have to indemnify an Indemnitee against special, indirect, consequential or punitive damages asserted against such Indemnitee by a third party.

(e)    Payment of Amounts Due. All amounts due under this Section 11.03 shall be payable promptly after written demand therefor.

11.04    Successors and Assigns.

(a)    Binding Effect. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that (i) Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of each Lender (and any attempted assignment or transfer by Borrower without such consent shall be null and void) and (ii) no Lender may assign or otherwise transfer its rights or obligations hereunder except in accordance with this Section 11.04. Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants (to the extent provided in Section 11.04(c) hereof) and, to the extent expressly contemplated hereby, the Related Parties of each of Administrative Agent and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.

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(b)    Assignments by Lenders.

(i)    Subject to the conditions set forth in Section 11.04(b)(ii) below, any Lender may assign to one or more Persons (other than an Ineligible Institution) all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans at the time owing to it) with the prior written consent (such consent not to be unreasonably withheld) of:

(A)    Borrower, provided that Borrower shall be deemed to have consented to any such assignment unless it shall object thereto by written notice to Administrative Agent within five (5) Business Days after having received notice thereof, and provided further that no consent of Borrower shall be required for an assignment to a Lender, an Affiliate of a Lender, an Approved Fund or, if a Default has occurred and is continuing, any other assignee; and

(B)    Administrative Agent, provided that no consent of Administrative Agent shall be required for an assignment of any Commitment to an assignee that is a Lender (other than a Lender that is a Defaulting Lender) with a Commitment immediately prior to giving effect to such assignment.

(ii)    Assignments shall be subject to the following additional conditions:

(A)    except in the case of an assignment to a Lender or an Affiliate of a Lender or an assignment of the entire remaining amount of the assigning Lender’s Commitment or Loans, the amount of the Commitment or Loans of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Assumption with respect to such assignment is delivered to Administrative Agent) shall not be less than $5,000,000 unless each of Borrower and Administrative Agent otherwise consent, provided that no such consent of Borrower shall be required if a Default has occurred and is continuing;

(B)    each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement;

(C)    the parties to each assignment shall execute and deliver to Administrative Agent, (x) an Assignment and Assumption, or (y) to the extent applicable, an agreement incorporating an Assignment and Assumption by reference pursuant to an Approved Electronic Platform as to which Administrative Agent and the parties to the Assignment and Assumption are participants, together with a processing and recordation fee of $3,500; and

(D)    the assignee, if it shall not be a Lender, shall deliver to Administrative Agent an Administrative Questionnaire in which the assignee designates one or more Credit Contacts to whom all syndicate-level information (which may contain material non-public information about Borrower, the Guarantor, and their Related Parties or their respective securities) will be made available and who may receive such information in accordance with the assignee’s compliance procedures and applicable laws, including Federal and state securities laws.

For the purposes of this Section 11.04(b), the terms “Approved Fund” and “Ineligible Institution” have the following meanings:

“Approved Fund” means any Person (other than a natural person) that is engaged in making, purchasing, holding or investing in bank loans and similar extensions of credit in the ordinary course of its business and that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

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“Ineligible Institution” means (a) a natural person, (b) a Defaulting Lender or its Lender Parent, (c) Borrower, Guarantor or any of their Affiliates, or (d) a company, investment vehicle or trust for, or owned and operated for the primary benefit of, a natural person or relative(s) thereof; provided that, with respect to clause (c), such company, investment vehicle or trust shall not constitute an Ineligible Institution if it (x) has not been established for the primary purpose of acquiring any Loans or Commitments, (y) is managed by a professional advisor, who is not such natural person or a relative thereof, having significant experience in the business of making or purchasing commercial loans, and (z) has assets greater than $25,000,000 and a significant part of its activities consist of making or purchasing commercial loans and similar extensions of credit in the ordinary course of its business.

(iii)    Subject to acceptance and recording thereof pursuant to Section 11.04(b)(iv), from and after the effective date specified in each Assignment and Assumption, the assignee thereunder shall be a party hereto and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto but shall continue to be entitled to the benefits of Sections 3.10, 3.11, 3.12, 4.11(c) and 11.03 hereof). Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this Section 11.04 shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with Section 11.04(c) hereof.

(iv)    Administrative Agent, acting for this purpose as a non-fiduciary agent of Borrower, shall maintain at one of its offices a copy of each Assignment and Assumption delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitment of, and principal amount (and stated interest) of the Loans owing to, each Lender pursuant to the terms hereof from time to time (the “Register”). The entries in the Register shall be conclusive, and Borrower, Administrative Agent and the Lenders may treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary.

(v)    Upon its receipt of (x) a duly completed Assignment and Assumption executed by an assigning Lender and an assignee, or (y) to the extent applicable, an agreement incorporating an Assignment and Assumption by reference pursuant to an Approved Electronic Platform as to which Administrative Agent and the parties to the Assignment and Assumption are participants, the assignee’s completed Administrative Questionnaire (unless the assignee shall already be a Lender hereunder), the processing and recordation fee referred to in Section 11.04 (b) hereof and any written consent to such assignment required by Section 11.04(b) hereof, Administrative Agent shall accept such Assignment and Assumption and record the information contained therein in the Register; provided that if either the assigning Lender or the assignee shall have failed to make any payment required to be made by it pursuant to Section 3.03(b), 3.13(d) or 11.03(c), Administrative Agent shall have no obligation to accept such Assignment and Assumption and record the information therein in the Register unless and until such payment shall have been made in full, together with all accrued interest thereon. No assignment shall be effective for purposes of this Agreement unless it has been recorded in the Register as provided in this Section.

(c)    Participations.

(i)    Any Lender may, without the consent of, or notice to, Borrower or Administrative Agent, sell participations to one or more banks or other entities (a “Participant”) in all or a portion of such Lender’s rights and/or obligations under this Agreement (including all or a portion of its Commitment and the Loans owing to it); provided that (A) such Lender’s obligations under this Agreement shall remain unchanged, (B) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (C) Borrower, Administrative Agent and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement. Any agreement or instrument pursuant to which a Lender sells such a participation shall provide

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that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver described in the first proviso to Section 11.02(b) that affects such Participant. Borrower agrees that each Participant shall be entitled to the benefits of Sections 3.10, 3.11 and 3.12 (subject to the requirements and limitations therein, including the requirements under Section 3.12(f) (it being understood that the documentation required under Section 3.12(f) shall be delivered to the participating Lender) to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to Section 11.04(b) hereof; provided that such Participant (A) agrees to be subject to the provisions of Section 3.14 as if it were an assignee under paragraph (b) of this Section; and (B) shall not be entitled to receive any greater payment under Section 3.10 or 3.12, with respect to any participation, than its participating Lender would have been entitled to receive, except to the extent such entitlement to receive a greater payment results from a Change in Law that occurs after the Participant acquired the applicable participation. Each Lender that sells a participation agrees, at Borrower’s request and expense, to use reasonable efforts to cooperate with Borrower to effectuate the provisions of Section 3.14(b) with respect to any Participant. To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 11.08 hereof as though it were a Lender; provided that such Participant agrees to be subject to Sections 3.13(c) hereof as though it were a Lender. Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Loans or other obligations under any Loan Document (the “Participant Register”); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register (including the identity of any Participant or any information relating to a Participant’s interest in any Commitments, Loans, or its other obligations under any Loan Document) to any Person except to the extent that such disclosure is necessary to establish that such Commitment, Loan, or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations. The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. For the avoidance of doubt, Administrative Agent (in its capacity as Administrative Agent) shall have no responsibility for maintaining a Participant Register.

(ii)    In no event may a Participant be an Affiliate of Borrower or Guarantor.

(d)    Pledges by Lenders. Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank, and this Section shall not apply to any such pledge or assignment of a security interest; provided that no such pledge or assignment of a security interest shall release a Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.

11.05    Survival.

All covenants, agreements, representations and warranties made by Borrower herein and in the certificates or other instruments delivered in connection with or pursuant to this Agreement and the other Loan Documents shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of this Agreement and the other Loan Documents and the making of any Loans, regardless of any investigation made by any such other party or on its behalf and notwithstanding that Administrative Agent or any Lender may have had notice or knowledge of any Default or Unmatured Default or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue in full force and effect as long as the principal of or any accrued interest on any Loan or any fee or any other amount payable under this Agreement is outstanding and so long as the Commitments have not expired or terminated. The provisions of Sections 3.10, 3.11, 3.12, 4.11(c) and 11.03 and Article XI hereof shall survive and remain in full force and effect regardless of the consummation of the transactions contemplated hereby, the repayment of the Loans, the expiration or termination the Commitments or the termination of this Agreement or any provision hereof.

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11.06    Counterparts; Integration; Effectiveness; Electronic Execution.

(a)    This Agreement may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Agreement and the other Loan Documents and any separate letter agreements with respect to fees paid to Administrative Agent constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. This Agreement shall become effective when it shall have been executed by Administrative Agent and when Administrative Agent shall have received counterparts hereof which, when taken together, bear the signatures of each of the other parties hereto, and thereafter shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns.

(b)    Delivery of an executed counterpart of a signature page of this Agreement by telecopy, emailed pdf. or any other electronic means that reproduces an image of the actual executed signature page shall be effective as delivery of a manually executed counterpart of this Agreement. The words “execution,” “signed,” “signature,” “delivery,” and words of like import in or relating to any document to be signed in connection with this Agreement and the transactions contemplated hereby shall be deemed to include Electronic Signatures, deliveries or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature, physical delivery thereof or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act; provided that nothing herein shall require Administrative Agent to accept Electronic Signatures in any form or format without its prior written consent. Without limiting the generality of the foregoing, Borrower hereby (i) agrees that, for all purposes, including without limitation, in connection with any workout, restructuring, enforcement of remedies, bankruptcy proceedings or litigation among Administrative Agent, the Lenders, Borrower and Guarantor, electronic images of this Agreement or any other Loan Documents (in each case, including with respect to any signature pages thereto) shall have the same legal effect, validity and enforceability as any paper original, and (ii) waives any argument, defense or right to contest the validity or enforceability of the Loan Documents based solely on the lack of paper original copies of any Loan Documents, including with respect to any signature pages thereto.

11.07    Severability.

Any provision of this Agreement or any other Loan Document held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof or thereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.

11.08    Right of Setoff.

If a Default shall have occurred and be continuing, each Lender and each of its Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by law, and to the extent permitted under Section 10.07 hereof, to setoff and apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other obligations at any time owing by such Lender or Affiliate to or for the credit or the account of Borrower against any of and all the obligations of Borrower now or hereafter existing under this Agreement or any other Loan Document to such Lender or its Affiliate, irrespective of whether or not such Lender or Affiliate shall have made any demand under this Agreement or any other Loan Document and although such obligations of Borrower may be contingent or unmatured or are owed to a branch office or Affiliate of such Lender different from the branch office or Affiliate holding such deposit or obligated on such indebtedness; provided that in the event that any Defaulting Lender shall exercise any such right of setoff, (x) all amounts so setoff shall be paid over immediately to Administrative Agent for further application in accordance with the provisions of Section 3.13 and, pending such payment, shall be segregated by such Defaulting Lender from its other funds and deemed held in trust for the benefit of Administrative Agent and the Lenders, and (y) the Defaulting Lender shall provide promptly to Administrative Agent a statement describing in reasonable detail the Obligations owing to such Defaulting Lender as to which it exercised such right of setoff. The rights of each Lender and its Affiliates under this Section are in addition to other

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rights and remedies (including other rights of setoff) that such Lender or its Affiliates may have. Notwithstanding the foregoing, each Lender agrees to obtain approval of the Required Lenders (other than any Defaulting Lender) before exercising such rights.

11.09    Governing Law; Jurisdiction; Consent to Service of Process.

(a)    Governing Law. This Agreement shall be construed in accordance with and governed by the internal laws (and not the law of conflicts) of the State of New York, but giving effect to federal laws applicable to national banks; provided however, that the provisions for the creation, perfection and enforcement of, and the remedies related to, the liens and security interests created hereunder and the other Loan Documents, including rights to a deficiency after judicial or nonjudicial foreclosure, shall be governed by Massachusetts law.

(b)    Consent to Jurisdiction.

(i)    Each of the Lenders and Administrative Agent hereby irrevocably and unconditionally agrees that, notwithstanding the governing law provisions of any applicable Loan Document, any claims brought against Administrative Agent by any Lender relating to this Agreement, any other Loan Document, the collateral or the consummation or administration of the transactions contemplated hereby or thereby shall be construed in accordance with and governed by the law of the State of New York.

(ii)    Each of the parties hereto hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of any U.S. federal or New York state court sitting in New York, New York, and any appellate court from any thereof, in any action or proceeding arising out of or relating to any Loan Documents, the transactions relating hereto or thereto, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may (and any such claims, cross-claims or third party claims brought against Administrative Agent or any of its Related Parties may only) be heard and determined in such state court or, to the extent permitted by law, in such federal court. Each of the parties hereto agrees 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. Nothing in this Agreement or any other Loan Document shall affect any right that Administrative Agent or any Lender may otherwise have to bring any action or proceeding relating to this Agreement or any other Loan Document against Borrower or any Guarantor or its properties in the courts of any jurisdiction.

(c)    Waiver of Objection to Venue. Each of the parties hereto hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement or any other Loan Document in any court referred to in Section 11.09(b) hereof. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.

(d)    Service of Process. Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 11.01. Nothing in this Agreement will affect the right of any party to this Agreement to serve process in any other manner permitted by law.

11.10    WAIVER OF JURY TRIAL.

EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

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11.11    Headings.

Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.

11.12    Confidentiality.

Each of Administrative Agent and the Lenders agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its and its Affiliates’ directors, officers, employees and agents, including accountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential), (b) to the extent requested by any Governmental Authority (including any self-regulatory authority, such as the National Association of Insurance Commissioners), (c) to the extent required by applicable laws or regulations or by any subpoena or similar legal process, (d) to any other party to this Agreement, (e) in connection with the exercise of any remedies hereunder or under any other Loan Document or any suit, action or proceeding relating to the Obligations or the enforcement of rights under the Loan Documents or any Swap Agreement, (f) subject to an agreement containing provisions substantially the same as those of this Section 11.12, to (x) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement or (y) any actual or prospective counterparty (or its advisors) to any Swap Agreement relating to Borrower and its obligations, (g) with the consent of Borrower, (h) to holders of equity interests in Borrower, or (i) to the extent such Information (x) becomes publicly available other than as a result of a breach of this Section or (y) becomes available to Administrative Agent or any Lender on a non-confidential basis from a source other than Borrower. For the purposes of this Section, “Information” means all information received from Borrower relating to Borrower or its business, other than any such information that is available to Administrative Agent or any Lender on a non-confidential basis prior to disclosure by Borrower and other than information pertaining to this Agreement routinely provided by arrangers to data service providers, including league table providers, that serve the lending industry; provided that, in the case of information received from Borrower after the date hereof, such information is clearly identified at the time of delivery as confidential. Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.

11.13    Interest Rate Limitation.

Notwithstanding anything herein to the contrary, if at any time the interest rate applicable to any Loan, together with all fees, charges and other amounts which are treated as interest on such Loan under applicable law (collectively the “Charges”), shall exceed the maximum lawful rate (the “Maximum Rate”) which may be contracted for, charged, taken, received or reserved by the Lender holding such Loan in accordance with applicable law, the rate of interest payable in respect of such Loan hereunder, together with all Charges payable in respect thereof, shall be limited to the Maximum Rate and, to the extent lawful, the interest and Charges that would have been payable in respect of such Loan but were not payable as a result of the operation of this Section shall be cumulated and the interest and Charges payable to such Lender in respect of other Loans or periods shall be increased (but not above the Maximum Rate therefor) until such cumulated amount, together with interest thereon at the NYFRB Rate to the date of repayment, shall have been received by such Lender.

11.14    USA Patriot Act.

Each Lender that is subject to the requirements of the USA PATRIOT Act of 2001 (the “Patriot Act”) hereby notifies Borrower that pursuant to the requirements of the Patriot Act, it is required to obtain, verify and record information that identifies Borrower, which information includes the name and address of Borrower and other information that will allow Administrative Agent or such Lender to identify Borrower in accordance with the Patriot Act.

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11.15    No Fiduciary Duty, Etc.

(a)    Borrower acknowledges and agrees, and acknowledges Guarantor’s understanding, that no Credit Party will have any obligations except those obligations expressly set forth herein and in the other Loan Documents and each Credit Party is acting solely in the capacity of an arm’s length contractual counterparty to Borrower with respect to the Loan Documents and the transactions contemplated herein and therein and not as a financial advisor or a fiduciary to, or an agent of, Borrower or any other person. Borrower agrees that it will not assert any claim against any Credit Party based on an alleged breach of fiduciary duty by such Credit Party in connection with this Agreement and the transactions contemplated hereby. Additionally, Borrower acknowledges and agrees that no Credit Party is advising Borrower as to any legal, tax, investment, accounting, regulatory or any other matters in any jurisdiction. Borrower shall consult with its own advisors concerning such matters and shall be responsible for making its own independent investigation and appraisal of the transactions contemplated herein or in the other Loan Documents, and the Credit Parties shall have no responsibility or liability to Borrower with respect thereto.

(b)    Borrower further acknowledges and agrees, and acknowledges Guarantor’s understanding, that each Credit Party, together with its Affiliates, is a full service securities or banking firm engaged in securities trading and brokerage activities as well as providing investment banking and other financial services. In the ordinary course of business, any Credit Party may provide investment banking and other financial services to, and/or acquire, hold or sell, for its own accounts and the accounts of customers, equity, debt and other securities and financial instruments (including bank loans and other obligations) of, Borrower and other companies with which Borrower may have commercial or other relationships. With respect to any securities and/or financial instruments so held by any Credit Party or any of its customers, all rights in respect of such securities and financial instruments, including any voting rights, will be exercised by the holder of the rights, in its sole discretion.

(c)    In addition, Borrower acknowledges and agrees, and acknowledges Guarantor’s understanding, that each Credit Party and its affiliates may be providing debt financing, equity capital or other services (including financial advisory services) to other companies in respect of which Borrower may have conflicting interests regarding the transactions described herein and otherwise. No Credit Party will use confidential information obtained from Borrower by virtue of the transactions contemplated by the Loan Documents or its other relationships with Borrower in connection with the performance by such Credit Party of services for other companies, and no Credit Party will furnish any such information to other companies. Borrower also acknowledges that no Credit Party has any obligation to use in connection with the transactions contemplated by the Loan Documents, or to furnish to Borrower, confidential information obtained from other companies..

11.16    Replacement Documentation.

Upon receipt of an affidavit of an officer of Administrative Agent or any of the Lenders as to the loss, theft, destruction or mutilation of a Note or any other security document which is not of public record, and, in the case of any such loss, theft, destruction or mutilation, Borrower will issue, in lieu thereof, a replacement Note or other security document in the same principal amount thereof and otherwise of like tenor. In the event that Borrower issues such replacement Note or other security document, the Lender who is the payee on the lost, destroyed, mutilated or stolen Note or security document shall indemnify and hold harmless Borrower from any liability incurred by Borrower in connection with the lost, stolen, destroyed or mutilated Note or security document.

11.17    Swap Agreements.

All Swap Agreements, if any, between Borrower and any Lender or Affiliate of any Lender are independent agreements governed by the written provisions of said Swap Agreements, which will remain in full force and effect, unaffected by any repayment, prepayment, acceleration, reduction, increase or change in the terms of the Loan Documents, except as otherwise expressly provided in said written Swap Agreements, and any payoff statement from Administrative Agent relating to the Loans shall not apply to said Swap Agreements.

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11.18    Statements.

Administrative Agent may from time to time provide Borrower with account statements or invoices with respect to any of the Obligations (the “Statements”). Administrative Agent is under no duty or obligation to provide Statements, which, if provided, will be solely for Borrower’s convenience. Statements may contain estimates of the amounts owed during the relevant billing period, whether of principal, interest, fees or other Obligations. If Borrower pays the full amount indicated on a Statement on or before the due date indicated on such Statement, Borrower shall not be in default of payment with respect to the billing period indicated on such Statement; provided, that acceptance by Administrative Agent of any payment that is less than the total amount actually due at that time (including but not limited to any past due amounts) shall not constitute a waiver of Administrative Agent’s right to receive payment in full at another time.

11.19    Acknowledgement and Consent to Bail-In of EEA Financial Institutions.

Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any EEA Financial Institution arising under any Loan Document may be subject to the Write-Down and Conversion Powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:

(a)    the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an EEA Financial Institution; and

(b)    the effects of any Bail-In Action on any such liability, including, if applicable:

(i)    a reduction in full or in part or cancellation of any such liability;

(ii)    a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEA Financial Institution, its parent entity, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or

(iii)    the variation of the terms of such liability in connection with the exercise of the Write-Down and Conversion Powers of any EEA Resolution Authority.

11.20    Acknowledgement Regarding Any Supported QFCs.

To the extent that the Loan Documents provide support, through a guarantee or otherwise, for Swap Agreements or any other agreement or instrument that is a QFC (such support “QFC Credit Support” and each such QFC a “Supported QFC”), the parties acknowledge and agree as follows with respect to the resolution power of the Federal Deposit Insurance Corporation under the Federal Deposit Insurance Act and Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act (together with the regulations promulgated thereunder, the “U.S. Special Resolution Regimes”) in respect of such Supported QFC and QFC Credit Support (with the provisions below applicable notwithstanding that the Loan Documents and any Supported QFC may in fact be stated to be governed by the laws of the State of New York and/or of the United States or any other state of the United States): In the event a Covered Entity that is party to a Supported QFC (each, a “Covered Party”) becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer of such Supported QFC and the benefit of such QFC Credit Support (and any interest and obligation in or under such Supported QFC and such QFC Credit Support, and any rights in property securing such Supported QFC or such QFC Credit Support) from such Covered Party will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if the Supported QFC and such QFC Credit Support (and any such interest, obligation and rights in property) were governed by the laws of the United States or a state of the United States. In the event a Covered Party or a BHC Act Affiliate of a Covered Party becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under the Loan Documents that might otherwise apply to such Supported QFC or any QFC Credit Support that may be exercised against such Covered Party are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if the Supported QFC and the Loan Documents were governed by the laws of the United States or a state of the United States. Without limitation of the foregoing, it is understood and agreed that rights and remedies of the parties with respect to a Defaulting Lender shall in no event affect the rights of any Covered Party with respect to a Supported QFC or any QFC Credit Support.

[SIGNATURE PAGES FOLLOW]

80

IN WITNESS WHEREOF, the parties hereto have caused this Revolving Loan and Security Agreement to be duly executed and delivered by their respective authorized officers as of the day and year first above written.

KRE JAG ONE UPLAND OWNER LLC,
a Delaware limited liability company
By:	CC One Upland, LLC,
	a Delaware limited liability company
Its:	Sole Member
	By:	Cottonwood Communities O.P., LP,
		a Delaware limited partnership
	Its:	Sole Member
		By:	Cottonwood Communities, Inc.,
			a Maryland corporation
		Its:	General Partner
			By:	/s/ Gregg T. Christensen
			Name:	Gregg T. Christensen
			Title:	Chief Legal Officer

[Signatures continue on following page]

[Signature Page to Revolving Loan and Security Agreement]

JPMORGAN CHASE BANK, N.A., as Administrative Agent, and individually as a Lender
By:	/s/ Austin R. Lotito
Name:	Austin R. Lotito
Title:	Vice President

SCHEDULE 1.01(a)

LENDERS

Name:	Address	Commitment
JPMorgan Chase Bank, N.A.	700 North Pearl, 13th Floor (TX1-2625), Dallas, TX 75201	$	67,600,000.00

SCHEDULE 1.01(b)

BORROWER’S ORGANIZATIONAL CHART

(see attached)

SCHEDULE 3.18

ELIGIBLE REAL ESTATE QUALIFICATION DOCUMENTS

With respect to any parcel of Real Estate of Borrower proposed to be included in the Collateral, each of the following, each in form substantially similar to the form previously delivered to Administrative Agent (to the extent applicable) unless (x) waived by Administrative Agent and the Required Lenders or (y) or previously delivered and approved as Required Lender BBP Deliverables:

Description of Property. A summary description of the Real Estate (including a structure chart showing the ownership of such Real Estate) and a Rent Roll.

Security Documents. Such Loan Documents relating to such Real Estate as Administrative Agent shall reasonably and customarily require, duly executed and delivered by the respective parties thereto. Without limiting the foregoing, such Loan Documents shall include (i) duly executed, acknowledged, and/or sworn to, as required, counterparts of the Mortgages and Assignment of Rents, which Mortgages shall have been delivered to Title Company and released for recordation in the official records of the city or county in which such Real Estate is located, with Administrative Agent agreeing that the principal amount secured by any Mortgage recorded in a jurisdiction with a material mortgage or similar tax shall be limited to an amount reasonably approved by Administrative Agent, and (ii) UCC-1 financing statements which shall have been furnished for filing in all filing offices that Administrative Agent may reasonably require.

Enforceability Opinion. If required by Administrative Agent, the favorable legal opinion of counsel to Borrower, from counsel reasonably acceptable to Administrative Agent and qualified to practice in the State in which such Real Estate is located, addressed to the Lenders and Administrative Agent covering the enforceability of such Loan Documents and such other matters as Administrative Agent shall reasonably request.

Perfection of Liens. Evidence reasonably satisfactory to Administrative Agent that the Loan Documents are effective to create in favor of Administrative Agent a legal, valid and enforceable first lien or security title and security interest in such Real Estate and that all filings, recordings, deliveries of instruments and other actions necessary or desirable to protect and preserve such liens or security title or security interests have been duly effected.

Survey and Taxes. The Survey of such Real Estate, together with the Surveyor Certification and evidence of payment of all real estate taxes, assessments and municipal charges on such Real Estate which on the date of determination are required to have been paid under Section 4.01.

Title Insurance; Title Exception Documents. The Title Policy (or “marked” commitment/pro forma policy for a Title Policy) covering such Real Estate, including all endorsements thereto, and together with proof of payment of all fees and premiums for such policy, and true and accurate copies of all documents listed as exceptions under such policy and a copy of any applicable ground lease.

UCC Certification. A certification from Title Company, records search firm, or counsel satisfactory to Administrative Agent that a search of the appropriate public records disclosed no conditional sales contracts, security agreements, chattel mortgages, leases of personalty, financing statements or title retention agreements which affect any property, rights or interests of Borrower that are or are intended to be subject to the security interest, security title, assignments, and mortgage liens created by the Loan Documents relating to such Real Estate except to the extent that the same are discharged and removed prior to or simultaneously with the inclusion of the Real Estate in the Collateral.

Property Management Agreement. A true copy of each Property Management Agreement, if any, relating to such Real Estate, which shall be in form and substance reasonably satisfactory to Administrative Agent, which Administrative Agent has a right to approve pursuant to the Loan Agreement.

Lease Form. The form of Lease, if any, to be used by Borrower in connection with future leasing of such Potential Collateral, which shall be in form and substance reasonably satisfactory to Administrative Agent.

Certificates of Insurance. Each of (i) a current certificate of insurance as to the insurance maintained by Borrower on such Real Estate (including flood insurance if necessary) from the insurer or an independent insurance broker dated as of the date of determination, identifying insurers, types of insurance, insurance limits, and policy terms; (ii) certified copies of all policies evidencing such insurance (or certificates therefor signed by the insurer or an agent authorized to bind the insurer); and (iii) such further information and certificates from Borrower, or their insurers and insurance brokers as Administrative Agent may reasonably request, all of which shall be in compliance with the requirements of this Agreement.

Property Condition Report. For any Real Estate which has been completed for more than six (6) months, a property condition report, together with any seismic probable maximum loss assessment to the extent customarily required for similar property, with appropriate reliance letters if such reports are not addressed to Administrative Agent, from a firm or firms of professional engineers or architects selected by Borrower and reasonably acceptable to Administrative Agent (the “Inspector”) reasonably satisfactory in form and content to Administrative Agent and the Required Lenders, dated not more than three hundred sixty (360) days prior to the inclusion of such Real Estate in the Collateral, addressing such matters as Administrative Agent and the Required Lenders may reasonably require; provided, that Administrative Agent shall rely on property condition reports and seismic probable maximum loss assessments previously obtained by Borrower, so long as such reports and assessment and Administrative Agent’s reliance thereon is commercially reasonable.

Hazardous Substance Assessments. A hazardous waste or other environmental site assessment report addressed to Administrative Agent (or the subject of a reliance letter addressed to, and in a form reasonably satisfactory to, Administrative Agent) concerning Hazardous Materials and asbestos on such Real Estate dated or updated not more than three hundred sixty (360) days prior to the inclusion of such Real Estate in the Collateral, from a firm of independent professional engineers or other scientists generally recognized as expert in the detection, analysis and remediation of Hazardous Materials and related environmental matters and acceptable to Administrative Agent in its reasonable discretion, such report to contain no qualifications except those that are acceptable to Administrative Agent and the Required Lenders in their reasonable discretion and to otherwise be in form and substance reasonably satisfactory to Administrative Agent in its sole discretion; provided, that Administrative Agent shall rely on such hazardous waste or other environmental site assessment report previously obtained by Borrower, so long as such reports and Administrative Agent’s reliance thereon is commercially reasonable.

Zoning and Land Use Compliance. Such evidence regarding zoning and land use compliance as Administrative Agent may reasonably request.

Certificate of Occupancy. Either (a) if reasonably available to Borrower and required by applicable law, a copy of the certificate(s) of occupancy issued to Borrower for such parcel of Real Estate permitting the use and occupancy of the Building thereon (or, if reasonably available to Borrower, a copy of the certificates of occupancy issued for such parcel of Real Estate and evidence reasonably satisfactory to Administrative Agent that any previously issued certificate(s) of occupancy is not required to be reissued to Borrower) or (b) other evidence reasonably satisfactory to Administrative Agent (including a statement from the applicable jurisdiction) that no certificates of occupancy are available and necessary to the use and occupancy thereof) and that there are no violations of law with respect to occupancy.

Appraisal. An Appraisal of such Real Estate, in form and substance satisfactory to Administrative Agent and the Required Lenders and dated not more than ninety (90) days prior to the inclusion of such Real Estate in the Collateral.

Budget. If requested by Administrative Agent, an operating and capital expenditure budget for such Real Estate in form and substance reasonably satisfactory to Administrative Agent.

Operating Statements. Operating statements for such Real Estate in the form of such statements delivered to the Lenders under Section 4.09 covering the last three (3) fiscal years and the interim period ending on the most recent fiscal quarter, to the extent Borrower owned such Real Estate during that period or Borrower actually receives such statements from the prior owner.

Environmental Disclosure. Such evidence regarding compliance with Section 4.10 as Administrative Agent may reasonably require.

Know Your Customer. Such information as Administrative Agent and the Lenders shall request with as to applicable “know your customer” and anti-money laundering rules and regulations, including the Patriot Act.

Additional Documents. Such other agreements, documents, certificates, reports or assurances as Administrative Agent may reasonably require.

EXHIBIT A

LEGAL DESCRIPTION

Parcel One

That certain parcel of land in Norwood, Norfolk County, Massachusetts shown as Lot 4A on a plan entitled “Campanelli Thorndike Norwood LLC, Lot 4A - Upland Woods Lower Road, Norwood, MA” prepared by Kelly Engineering Group, Inc. dated October 10, 2014 recorded with the Norfolk County Registry of Deeds in Plan Book 635, Page 22.

Parcel Two

Together with the benefits of the Access Easement for Use of Common Areas and other easements set forth in Paragraph 8 of the Park Covenants and Maintenance Agreement by and be-tween CFRI/CQ Norwood Upland, L.L.C. and Upland Woods Management LLC dated February 10, 2005 recorded in Book 22094, Page 439 and filed as Document No. 1055346, as amended by First Amendment to Park Covenants and Maintenance Agreement dated September 22, 2017 and recorded October 26, 2017 in Book 35548, Page 179.

Parcel Three

Together with the benefit of the Utility and Sewer Easement Agreement dated as of November 14, 2014 by and between CFRI/CQ Norwood Upland L.L.C. and Campanelli Thorndike Nor-wood LLC recorded in Book 32699 Page 206 as amended by Amendment to Utility and Sewer Easement Agreement between Campanelli-Trigate Norwood Upland, L.L.C. and Campanelli Thorndike Norwood LLC dated as of June 29, 2017 recorded June 30, 2017 in Book 35240 Page 176.

EXHIBIT B

PROMISSORY NOTE

$                              [Date]                                                 

                                         LLC, a Delaware limited liability company (“Borrower”), promises to pay to the order of                                          (“Lender”)                                          DOLLARS ($                                    ), or if less, the aggregate unpaid principal amount of all Loans made by Lender to Borrower pursuant to the Agreement (as hereinafter defined), together with interest on the unpaid principal amount hereof in the manner set forth in the Agreement. Borrower shall pay the principal of and accrued and unpaid interest on the Loan in full on the Maturity Date.

This Note is one of the Notes issued pursuant to, and is entitled to the benefits of, the Revolving Loan and Security Agreement of even date herewith (which, as it may be amended or modified and in effect from time to time, is herein called the “Agreement”), among Borrower, the lenders referenced therein, including Lender, and JPMorgan Chase Bank, N.A., as Administrative Agent, to which Agreement reference is hereby made for a statement of the terms and conditions governing this Note, including the terms and conditions under which this Note may be prepaid or its maturity date accelerated. This Note is secured and guaranteed pursuant to the Loan Documents, all as more specifically described in the Agreement, and reference is made thereto for a statement of the terms and provisions thereof. Capitalized terms used herein and not otherwise defined herein are used with the meanings attributed to them in the Agreement.

[NAME OF BORROWER]

By:

Name:

Title:

EXHIBIT C

INTENTIONALLY OMITTED

EXHIBIT D

ASSIGNMENT AND ASSUMPTION

This Assignment and Assumption (the “Assignment and Assumption”) is dated as of the Effective Date set forth below and is entered into by and between [Insert name of Assignor] (the “Assignor”) and [Insert name of Assignee] (the “Assignee”). Capitalized terms used but not defined herein shall have the meanings given to them in the Loan Agreement identified below (as amended, supplemented or otherwise modified from time to time, the “Loan Agreement”), receipt of a copy of which is hereby acknowledged by the Assignee. The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein by reference and made a part of this Assignment and Assumption as if set forth herein in full.

For an agreed consideration, the Assignor hereby irrevocably sells and assigns to the Assignee, and the Assignee hereby irrevocably purchases and assumes from the Assignor, subject to and in accordance with the Standard Terms and Conditions and the Loan Agreement, as of the Effective Date inserted by Administrative Agent as contemplated below (i) all of the Assignor’s rights and obligations in its capacity as a Lender under the Loan Agreement and any other documents or instruments delivered pursuant thereto to the extent related to the amount and percentage interest identified below of all of such outstanding rights and obligations of the Assignor under the respective facilities identified below and (ii) to the extent permitted to be assigned under applicable law, all claims, suits, causes of action and other rights of the Assignor (in its capacity as a Lender) against any Person, whether known or unknown, arising under or in connection with the Loan Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing, including contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold and assigned pursuant to clauses (i) and (ii) above being referred to herein collectively as the “Assigned Interest”). Such sale and assignment is without recourse to the Assignor and, except as expressly provided in this Assignment and Assumption, without representation or warranty by the Assignor.

1. Assignor:                                                                          

2. Assignee:                                                                          

[and is an Affiliate/Approved Fund of [identify Lender]]

3. Borrower(s):                                                                     

4. Administrative Agent:                     , as the administrative agent under the Loan Agreement

5. Credit Agreement: [The [amount] Revolving Loan and Security Agreement dated as of              among [name of Borrower(s)], the Lenders parties thereto, [name of Administrative Agent], as Administrative Agent, and the other agents parties thereto]

6. Assigned Interest:

Facility Assigned	Aggregate Amount of Commitment/Loans for all Lenders	Amount of Commitment/Loans Assigned	Percentage Assigned of Commitment/Loans
	$	$		%
	$	$		%
	$	$		%

Effective Date:                     , 20     [TO BE INSERTED BY ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.]

The Assignee agrees to deliver to Administrative Agent a completed Administrative Questionnaire in which the Assignee designates one or more Credit Contacts to whom all syndicate-level information (which may contain material non-public information about Borrower, the Guarantor, and their Related Parties or their respective securities) will be made available and who may receive such information in accordance with the Assignee’s compliance procedures and applicable laws, including Federal and state securities laws.

The terms set forth in this Assignment and Assumption are hereby agreed to:

ASSIGNOR

[NAME OF ASSIGNOR]

By:

Title:

ASSIGNEE

[NAME OF ASSIGNEE]

By:

Title:

Consented to and Accepted:

[NAME OF ADMINISTRATIVE AGENT], as

Administrative Agent

By

Title:

ANNEX 1

[                    ]

STANDARD TERMS AND CONDITIONS FOR

ASSIGNMENT AND ASSUMPTION

1.    Representations and Warranties.

1.1    Assignor. The Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is free and clear of any lien, encumbrance or other adverse claim and (iii) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby; and (b) assumes no responsibility with respect to (i) any statements, warranties or representations made in or in connection with the Loan Agreement or any other Loan Document, (ii) the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any collateral thereunder, (iii) the financial condition of Borrower, any of its subsidiaries or Affiliates or any other Person obligated in respect of any Loan Document, (iv) any requirements under applicable law for the Assignee to become a lender under the Loan Agreement or to charge interest at the rate set forth therein from time to time, or (v) the performance or observance by Borrower, any of its subsidiaries or Affiliates or any other Person of any of their respective obligations under any Loan Document.

1.2    Assignee. The Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby and to become a Lender under the Loan Agreement, (ii) it satisfies the requirements, if any, specified in the Loan Agreement and under applicable law that are required to be satisfied by it in order to acquire the Assigned Interest and become a Lender, (iii) from and after the Effective Date, it shall be bound by the provisions of the Loan Agreement as a Lender thereunder and, to the extent of the Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it is sophisticated with respect to decisions to acquire assets of the type represented by the Assigned Interest and either it, or the Person exercising discretion in making its decision to acquire the Assigned Interest, is experienced in acquiring assets of such type, (v) it has received a copy of the Loan Agreement, together with copies of the most recent financial statements delivered pursuant to Section [                    ] thereof, as applicable, and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and Assumption and to purchase the Assigned Interest on the basis of which it has made such analysis and decision independently and without reliance on Administrative Agent, any Arranger, the Assignor or any other Lender or any of their respective Related Parties, and (vi) attached to the Assignment and Assumption is any documentation required to be delivered by it pursuant to the terms of the Loan Agreement, duly completed and executed by the Assignee; and (b) agrees that (i) it will, independently and without reliance on Administrative Agent, any Arranger, the Assignor or any other Lender or any of their respective Related Parties, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Documents, and (ii) it will perform in accordance with their terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a Lender.

2.    Payments. From and after the Effective Date, Administrative Agent shall make all payments in respect of the Assigned Interest (including payments of principal, interest, fees and other amounts) to the Assignor for amounts which have accrued to but excluding the Effective Date and to the Assignee for amounts which have accrued from and after the Effective Date.

3.    General Provisions. This Assignment and Assumption shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns. This Assignment and Assumption may be executed in any number of counterparts, which together shall constitute one instrument. Acceptance and adoption of the terms of this Assignment and Assumption by the Assignee and Assignor by Electronic Signature or delivery of an executed counterpart of a signature page of this Assignment and Assumption by any Approved Electronic Platform shall be effective as delivery of a manually executed counterpart of this Assignment and Assumption. This Assignment and Assumption shall be governed by, and construed in accordance with, the law of the State of [New York..

EXHIBIT E-1

FORM OF BORROWER COMPLIANCE CERTIFICATE

[BORROWER’S LETTERHEAD]

[Address]

                    , 20    

COMPLIANCE CERTIFICATE

[Via Email: Middle.Market.Agency@jpmorgan.com]

OR

[Via Email: REB.Compliance@jpmorgan.com]

JPMorgan Chase Bank, N.A., as Administrative Agent

Attention: [                    ]

Ladies and Gentlemen:

This compliance certificate (this “Certificate”) is being delivered by [                    ] (“Borrower”) pursuant to Section 4.14[(a)([ ])] of that certain Revolving Loan and Security Agreement, dated as of [                    ], [among Borrower, Administrative Agent and the Lenders thereto (as the same may have been or may hereafter be amended, modified, supplemented, restated and/or replaced from time to time, the “Loan Agreement”). All capitalized terms used but not defined in this Certificate shall have the meanings given in the Loan Agreement.

This Certificate is being given for the fiscal [quarter] [year] ending on                     , 20     (the “Covenant Certification Date”). Borrower hereby certifies to Administrative Agent, for the benefit of the Lenders, as follows:

1.     The undersigned is currently the                      of Borrower and is fully authorized to act in such capacity and execute and deliver this Certificate.

2.    No Default or Unmatured Default has occurred and is continuing as of the date of this Certificate, except as set forth below [if blank, there are no exceptions]:

3.    All representations and warranties made by Borrower in the Loan Documents (and any certificate, document or financial or any other statement furnished pursuant to or in connection therewith) remain true and correct in all material respects (except for changes in conditions disclosed to Administrative Agent that would not cause a Default under the Loan Documents) on and as of the date of this Certificate with the same force and effect as if made on and as of such date.

4.     No material adverse change as to Borrower has occurred since the date of the last compliance certificate delivered to Administrative Agent pursuant to Section 4.09[(a)([    ])] of the Loan Agreement, and no event or condition that could reasonably be expected to have a material adverse change in the financial condition of Borrower has occurred, except as set forth below [if blank, there are no exceptions]:

5.     Attached hereto as Exhibit [A] are the [quarterly] [semi-annual] [annual] financial statements of Borrower required by Section 4.09[(a)([    ])] of the Loan Agreement for the fiscal [quarter] [two quarters] [year] ending on                     , 20    , which financial statements are true, accurate and complete as of the date thereof.

6.    Attached hereto as Exhibit [B] are the [quarterly] [semi-annual] [annual] [operating statements] [leasing reports] [rent rolls] required by Section 4.09[(a)([    ])] of the Loan Agreement, which [operating statements] [leasing reports] [rent rolls] are true, accurate and complete as of the date hereof.

7.    As demonstrated by the attached calculations and documentation supporting this Certificate, as of the Covenant Certification Date, [the Debt Service Coverage Ratio], as calculated in accordance with the Loan Agreement, was      to 1.00, which [satisfied] [did not satisfy] the Debt Service Coverage Ratio requirement of      to 1.00.

(a)    See Schedule [II] for [the Debt Service Coverage Ratio] calculations and supporting documents.

8.     As demonstrated by the attached calculations and documentation supporting this Certificate, as of the Covenant Certification Date, [the Debt Yield], as calculated in accordance with the Loan Agreement, was     %, which [satisfied] [did not satisfy] the Debt Yield requirement of     %.

(a)    See Schedule [III] for [the Debt Yield] calculations and supporting documents.

9.    As demonstrated by the attached calculations and documentation supporting this Certificate, as of the Covenant Certification Date, the [INSERT ANY OTHER FINANCIAL COVENANTS], as calculated in accordance with the Loan Agreement, equaled     , which [satisfied] [did not satisfy] the [                    ] requirement under Section [                    ] of the Loan Agreement.

(a)    See Schedule [V] for the [                    ] calculations and supporting documents.

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

IN WITNESS WHEREOF, the undersigned [has] [have] executed this Certificate this              day of             ,             .

BORROWER:

[ENTITY],

a                     

By:

Name:

Title:

[Signature Page to Compliance Certificate]

[Create separate exhibit cover pages as necessary]

EXHIBIT [                    ]

[FINANCIAL STATEMENTS]

[OPERATING STATEMENTS]

[LEASING REPORTS]

[                    ]

[Create separate schedule cover pages as necessary]

SCHEDULE [                    ]

[LOAN-TO-VALUE RATIO CALCULATIONS AND SUPPORTING DOCUMENTS]

[DEBT SERVICE COVERAGE RATIO CALCULATIONS AND SUPPORTING DOCUMENTS]

[DEBT YIELD CALCULATIONS AND SUPPORTING DOCUMENTS]

[                                                                                  ]

[EXHIBIT E-2]

FORM OF GUARANTOR COMPLIANCE CERTIFICATE

[GUARANTOR’S LETTERHEAD]

[Address]

                    , 20    

COMPLIANCE CERTIFICATE

[Via Email: Middle.Market.Agency@jpmorgan.com]

OR

[Via Email: REB.Compliance@jpmorgan.com]

JPMorgan Chase Bank, N.A., as Administrative Agent

Attention: [                    ]

Ladies and Gentlemen:

This compliance certificate (this “Certificate”) is being delivered by [                    ] (“Guarantor”) pursuant to [Section 4.09(b)([ ]) of that certain Revolving Loan and Security Agreement, dated as of [                    ], among                     , Administrative Agent and the Lenders thereto (as the same may have been or may hereafter be amended, modified, supplemented, restated and/or replaced from time to time, the “Loan Agreement”). All capitalized terms used but not defined in this Certificate shall have the meanings given in the Loan Agreement.

This Certificate is being given for the fiscal [year] ending on                     , 20     (the “Covenant Certification Date”). Guarantor hereby certifies to Administrative Agent, for the benefit of the Lenders, as follows:

1.    [IF ENTITY GUARANTOR]: The undersigned is currently the                      of Guarantor and is fully authorized to act in such capacity and execute and deliver this Certificate.

2.    No Default or Unmatured Default has occurred and is continuing as of the date of this Certificate, except as set forth below [if blank, there are no exceptions]:

3.    All representations and warranties made by Guarantor in the Loan Documents (and any certificate, document or financial or any other statement furnished pursuant to or in connection therewith) remain true and correct in all material respects (except for changes in conditions disclosed to Administrative Agent that would not cause a Default under the Loan Documents) on and as of the date of this Certificate with the same force and effect as if made on and as of such date.

4.    No material adverse effect as to Guarantor has occurred since the date of the last compliance certificate delivered to Administrative Agent pursuant to [Section 4.09(b)([    ]) of the Loan Agreement, and no event or condition that could reasonably be expected to have a material adverse effect in the financial condition of Guarantor has occurred, except as set forth below [if blank, there are no exceptions]:

5.    Attached hereto as Exhibit [A] are the [quarterly] [annual] financial statements of Guarantor required by [Section 4.09(b)([    ]) of the Loan Agreement for the fiscal [quarter] [year] ending on                     , 20    , which financial statements are true, accurate and complete as of the date thereof.

6.    As demonstrated by the attached calculations and documentation supporting this Certificate, as of the Covenant Certification Date, [the market value of Guarantor’s Liquid Assets (as defined in the Guaranty)] was                     , which [satisfied] [did not satisfy] the Liquid Assets covenant under Section [    ] of the Guaranty.

(a)    See Schedule [I] for the [Liquid Assets] calculations and supporting documents.

7.    As demonstrated by the attached calculations and documentation supporting this Certificate, as of the Covenant Certification Date, the Guarantor’s [Net Worth (as defined in the Guaranty)] was                     , which [satisfied] [did not satisfy] the Net Worth covenant under Section [    ] of the Guaranty.

(a)    See Schedule [II] for the [Net Worth] calculations and supporting documents.

8.    As demonstrated by the attached calculations and documentation supporting this Certificate, as of the Covenant Certification Date, the Guarantor’s [Contingent Liabilities (as defined in the Guaranty)] were                     , which [satisfied] [did not satisfy] the Contingent Liabilities covenant under Section [    ] of the Guaranty.

(a)    See Schedule [III] for the [Contingent Liabilities] calculations and supporting documents.

9.    As demonstrated by the attached calculations and documentation supporting this Certificate, as of the Covenant Certification Date, the Guarantor’s [INSERT ANY OTHER GUARANTOR FINANCIAL COVENANTS] equaled                     , which [satisfied] [did not satisfy] the [                    ] covenant under Section [    ] of the Guaranty.

(a)    See Schedule [IV] for the [                    ] calculations and supporting documents.

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

IN WITNESS WHEREOF, the undersigned [has] [have] executed this Certificate this                      day of         ,             .

GUARANTOR:

By:

Name:

Title:

[Signature Page to Compliance Certificate]

[Create separate exhibit cover pages as necessary]

EXHIBIT [                    ]

[FINANCIAL STATEMENTS]

[OPERATING STATEMENTS]

[LEASING REPORTS]

[                                         ]

[Create separate schedule cover pages as necessary]

SCHEDULE [                    ]

[LIQUID ASSETS CALCULATIONS AND SUPPORTING DOCUMENTS]

[NET WORTH CALCULATIONS AND SUPPORTING DOCUMENTS]

[CONTINGENT LIABILITIES CALCULATIONS AND SUPPORTING DOCUMENTS]

[                                                                                          ]

EXHIBIT F-1

[FORM OF]

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Lenders That Are Not Partnerships For U.S. Federal Income Tax Purposes)

Reference is hereby made to the Revolving and Term Loan and Security Agreement dated as of [    ] (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among [    ], and each lender from time to time party thereto.

Pursuant to the provisions of Section 3.12 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record and beneficial owner of the Loan(s) (as well as any Note(s) evidencing such Loan(s)) in respect of which it is providing this certificate, (ii) it is not a bank within the meaning of Section 881(c)(3)(A) of the Code, (iii) it is not a ten percent shareholder of Borrower within the meaning of Section 881(c)(3)(B) of the Code and (iv) it is not a controlled foreign corporation related to Borrower as described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished Administrative Agent and Borrower with a certificate of its non-U.S. Person status on IRS Form W-8BEN-E or IRS Form W-8BEN. By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform Borrower and Administrative Agent, and (2) the undersigned shall have at all times furnished Borrower and Administrative Agent with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

[NAME OF LENDER]

By:
	Name:
	Title:

Date:                  , 20[    ]

EXHIBIT F-2

[FORM OF]

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Participants That Are Not Partnerships For U.S. Federal Income Tax Purposes)

Reference is hereby made to the Revolving and Term Loan and Security Agreement dated as of [    ] (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among [    ], and each lender from time to time party thereto.

Pursuant to the provisions of Section 3.12 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record and beneficial owner of the participation in respect of which it is providing this certificate, (ii) it is not a bank within the meaning of Section 881(c)(3)(A) of the Code, (iii) it is not a ten percent shareholder of Borrower within the meaning of Section 881(c)(3)(B) of the Code, and (iv) it is not a controlled foreign corporation related to Borrower as described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished its participating Lender with a certificate of its non-U.S. Person status on IRS Form W-8BEN-E or IRS Form W-8BEN. By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform such Lender in writing, and (2) the undersigned shall have at all times furnished such Lender with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

[NAME OF PARTICIPANT]

By:
	Name:
	Title:

Date:                  , 20[    ]

EXHIBIT F-3

[FORM OF]

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Participants That Are Partnerships For U.S. Federal Income Tax Purposes)

Reference is hereby made to the Revolving and Term Loan and Security Agreement dated as of [    ] (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among [    ], and each lender from time to time party thereto.

Pursuant to the provisions of Section 3.12 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record owner of the participation in respect of which it is providing this certificate, (ii) its direct or indirect partners/members are the sole beneficial owners of such participation, (iii) with respect such participation, neither the undersigned nor any of its direct or indirect partners/members is a bank extending credit pursuant to a loan agreement entered into in the ordinary course of its trade or business within the meaning of Section 881(c)(3)(A) of the Code, (iv) none of its direct or indirect partners/members is a ten percent shareholder of Borrower within the meaning of Section 881(c)(3)(B) of the Code and (v) none of its direct or indirect partners/members is a controlled foreign corporation related to Borrower as described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished its participating Lender with IRS Form W-8IMY accompanied by one of the following forms from each of its partners/members that is claiming the portfolio interest exemption: (i) an IRS Form W-8BEN-E or IRS Form W-8BEN or (ii) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN-E or IRS Form W-8BEN from each of such partner’s/member’s beneficial owners that is claiming the portfolio interest exemption. By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform such Lender and (2) the undersigned shall have at all times furnished such Lender with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

[NAME OF PARTICIPANT]

By:
	Name:
	Title:

Date:                  , 20[    ]

EXHIBIT F-4

[FORM OF]

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Lenders That Are Partnerships For U.S. Federal Income Tax Purposes)

Reference is hereby made to the Revolving and Term Loan and Security Agreement dated as of [    ] (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among [    ], and each lender from time to time party thereto.

Pursuant to the provisions of Section 3.12 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record owner of the Loan(s) (as well as any Note(s) evidencing such Loan(s)) in respect of which it is providing this certificate, (ii) its direct or indirect partners/members are the sole beneficial owners of such Loan(s) (as well as any Note(s) evidencing such Loan(s)), (iii) with respect to the extension of credit pursuant to this Credit Agreement or any other Loan Document, neither the undersigned nor any of its direct or indirect partners/members is a bank extending credit pursuant to a loan agreement entered into in the ordinary course of its trade or business within the meaning of Section 881(c)(3)(A) of the Code, (iv) none of its direct or indirect partners/members is a ten percent shareholder of Borrower within the meaning of Section 881(c)(3)(B) of the Code and (v) none of its direct or indirect partners/members is a controlled foreign corporation related to Borrower as described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished Administrative Agent and Borrower with IRS Form W-8IMY accompanied by one of the following forms from each of its partners/members that is claiming the portfolio interest exemption: (i) an IRS FORM W-8BEN or IRS Form W-8BEN-E or (ii) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN-E or IRS Form W-8BEN from each of such partner’s/member’s beneficial owners that is claiming the portfolio interest exemption. By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform Borrower and Administrative Agent, and (2) the undersigned shall have at all times furnished Borrower and Administrative Agent with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

[NAME OF LENDER]

By:
	Name:
	Title:

Date:                  , 20[    ]

EX-10.17

Exhibit 10.17

PROMISSORY NOTE

$67,600,000 As of March 19, 2020

KRE JAG ONE UPLAND OWNER LLC, a Delaware limited liability company (“Borrower”), promises to pay to the order of JPMORGAN CHASE BANK, N.A., or its registered assigns (“Lender”) SIXTY-SEVEN MILLION SIX HUNDRED THOUSAND AND 00/100 DOLLARS ($67,600,000), or if less, the aggregate unpaid principal amount of all Loans made by Lender to Borrower pursuant to the Agreement (as hereinafter defined), together with interest on the unpaid principal amount hereof in the manner set forth in the Agreement. Borrower shall pay the principal of and accrued and unpaid interest on the Loan in full on the Maturity Date.

This Note is one of the Notes issued pursuant to, and is entitled to the benefits of, the Revolving Loan and Security Agreement of even date herewith (which, as it may be amended or modified and in effect from time to time, is herein called the “Agreement”), among Borrower, the lenders referenced therein, including Lender, and JPMorgan Chase Bank, N.A., as Administrative Agent, to which Agreement reference is hereby made for a statement of the terms and conditions governing this Note, including the terms and conditions under which this Note may be prepaid or its maturity date accelerated. This Note is secured and guaranteed pursuant to the Loan Documents, all as more specifically described in the Agreement, and reference is made thereto for a statement of the terms and provisions thereof. Capitalized terms used herein and not otherwise defined herein are used with the meanings attributed to them in the Agreement.

[Signature Page Follows]

KRE JAG ONE UPLAND OWNER LLC,
a Delaware limited liability company
By:	CC One Upland, LLC,
	a Delaware limited liability company
Its:	Sole Member
	By:	Cottonwood Communities O.P., LP,
		a Delaware limited partnership
	Its:	Sole Member
		By:	Cottonwood Communities, Inc.,
			a Maryland corporation
		Its:	General Partner
			By:	/s/ Gregg T. Christensen
			Name:	Gregg T. Christensen
			Title:	Chief Legal Officer

[Signature Page to Promissory Note]

EX-10.18

Exhibit 10.18

PROPERTY MANAGEMENT AGREEMENT

This PROPERTY MANAGEMENT AGREEMENT (the “Agreement”) is effective as of March 19, 2020 (the “Effective Date”) by and between KRE JAG One Upland Owner LLC, a Delaware limited liability company (the “Property Owner”) the owner of One Upland Apartments which consists of 262 units located at One Upland Woods Circle, Norwood, Massachusetts, and as more particularly described in Exhibit A attached hereto and incorporated herein (the “Project”) and Cottonwood Communities Management, LLC, a Delaware limited liability company (the “Property Manager”).

The Property Owner desires to engage the Property Manager to supervise, manage, lease, operate, and maintain the Project.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows:

1. Commencement and Termination Dates.

1.1 Commencement. The Property Manager’s duties and responsibilities under this Agreement shall begin on the Effective Date.

1.2 Termination. This Agreement shall automatically terminate on the earlier of (a) Property Manager receiving written notification from Owner that the Advisory Agreement dated August 13, 2018, between Cottonwood Communities, Inc. and the Property Manager, or any successor advisory services agreement between Cottonwood Communities, Inc. and an affiliate of the Property Manager (the “Advisory Agreement”) has terminated, unless the holder of a mortgage on a Project otherwise determines to keep this Agreement in effect, (b) a termination as provided in Section 10, and (c) the sale of the Project.

2. Property Manager’s Responsibilities.

2.1 Status of the Property Manager. The Property Owner and the Property Manager do not intend to form a joint venture, partnership or similar relationship. Instead, the parties intend that the Property Manager shall act solely in the capacity of an independent contractor for the Property Owner. Nothing in this Agreement shall cause the Property Manager and the Property Owner to be joint venturers or partners of each other, and neither shall have the power to bind or obligate the other party by virtue of this Agreement, except as expressly provided in this Agreement. Nothing in this Agreement shall deprive or otherwise affect the right of the parties to this Agreement to own, invest in, manage or operate, or to conduct business activities that compete with the business of the Project.

2.2 Management.

2.2.1 Generally. The Property Manager shall manage, operate and maintain the Project in a commercially reasonable manner for the tenants thereof, subject to (a) applicable governmental requirements and (b) the terms and provisions of this Agreement. At the expense of the Property Owner, the Property Manager shall keep the Project clean and in good repair, and shall order and supervise the completion of such repairs as may be required, provided that the Property Owner, in a manner reasonably satisfactory to the Property Manager, makes available to the Property Manager sufficient sums to pay the costs thereof.

2.2.2 Responsibility Relating to Loans. In addition to the foregoing, the Property Manager shall have responsibility for interfacing and communicating with the owner and holder of any deed of trust or mortgage upon the Project and its successors and assigns (a “Lender”) and shall: (a) perform all services customarily provided by a property manager, with respect to interfacing with the Lender in connection with the loan secured by such deed of trust or mortgage (“Loan”) and all other documents executed in connection therewith (the “Loan Documents”), including, without limitation, designating changes in address, receiving any and all notices, including, without limitation, default notices on behalf of the Property Owner, requesting and receiving any amounts out of any reserve accounts or escrow accounts maintained by Lender, or its successors and assigns, on account of repairs, capital improvements, tenant improvements, leasing commissions, real estate taxes and assessments and insurance proceeds or otherwise; and (b) with the consent of the Property Owner, request waivers of provisions under the Loan Documents and negotiate conditions to any such requested waivers that might be granted by the Lender and its successors and assigns, depositing rents or other revenues in any lockbox account maintained under such Loan Documents, receiving into an operating account to be maintained by the Property Manager for the benefit of the Property Owner all disbursements made out of any such lockbox to the Property Owner as the borrower thereunder for the payment of operating expenses of the Project, or otherwise to be made to or to the account of the Property Owner as such borrower, requesting and receiving any amounts out of any reserve accounts or escrow accounts maintained by such Lender on account of repairs, capital improvements, tenant improvements, leasing commissions, real estate taxes and assessments and insurance proceeds or otherwise.

2.3 Employees/Independent Contractors of Property Manager. The Property Manager shall employ, directly or through third party contractors (e.g. employee leasing company) employees and/or independent contractors to enable the Property Manager to manage, operate and maintain the Project. All matters pertaining to the supervision of such employees and independent contractors shall be the responsibility of the Property Manager. All salaries, benefits and positions of employees who perform work in connection with the Project shall be consistent with the Budget (as defined in Section 2.5).

2.4 Compliance with Laws, Mortgages and Other Matters.

2.4.1 The Property Manager shall comply with all applicable local, state and federal laws (collectively “Laws”). The Property Manager may implement such procedures with respect to the Project as the Property Manager may deem advisable for the efficient and economic management and operation thereof. The Property Manager shall pay from the Operating Account (defined in Section 6.1) expenses incurred to remedy violations of Laws. However, the Property Manager shall not be obligated to remedy any violations of Law if sufficient funds are not available in the Operating Account or if the Property Owner does not provide sufficient additional funds to do so.

2.4.2 The Property Manager shall furnish to the Property Owner, promptly after receipt, any notice of violation of any material Laws issued by any governmental entity or any notice of termination or cancellation of any insurance policy.

2.4.3 The Property Manager shall use commercially reasonable efforts to comply with the Loan Documents. The Property Manager shall furnish to the Property Owner, promptly after receipt, any notices of default received from a Lender. The Property Owner shall furnish to the Property Manager, promptly after receipt, any notices of default received from a Lender.

2.5 Budgets.

2.5.1 The Property Manager shall prepare and submit to the Property Owner annually an annual capital and operating budget (“Budget”) for the promotion, operation, leasing, repair, maintenance and improvement of the Project for each calendar year. The Budget for the initial calendar year, preapproved by the Property Owner, is attached hereto as Exhibit B and incorporated herein by this reference. The Property Manager shall deliver the Budget for each subsequent calendar year on or prior to December 1^st of the calendar year before the budget year, or as soon as possible thereafter. The Property Owner shall have thirty (30) days after delivery of the Budget to approve or disapprove of the Budget. The Property Owner agrees to use its best efforts to approve the Budget. If the Property Owner does not disapprove of the Budget (which disapproval shall be in writing to the Property Manager), or any item therein, within such thirty (30) day specified response period described above, the Property Owner shall have been deemed to have approved the Budget. In the event the approval is not obtained, the Property Owner shall negotiate in good faith with the Property Manager for fifteen (15) days to resolve the issue. If the parties are unable to reach an agreement, the issue shall be resolved by arbitration as set forth in Section 13.5 with the Property Owner on the one hand, and the Property Manager on the other hand; the costs of the arbitration shall be paid by the Project. The Property Manager may proceed under the terms of the proposed Budget for items that are not objected to and may take any action with respect to Permitted Expenditures (as defined in Section 2.5.2 below). In the event that the items that are objected to are operational expenditures, as opposed to capital expenditures, the Property Manager shall be entitled to operate the Project using the prior year’s Budget for such items plus five percent (5%) until approval is obtained. The Property Manager may at any time submit a revised Budget to the Property Owner for its approval, which will be governed by the terms of this Section 2.5.1 and shall continue to operate the Project under the previously approved Budget until the revised Budget is approved. The Property Manager shall provide the Property Owner with such information regarding the Budget as may be, from time to time, reasonably requested by the Property Owner.

2.5.2 The Property Manager shall charge all expenses to the proper account as specified in the Budget, provided that the Property Manager may reallocate savings from one line item to other line items for the benefit of the Property Owner. The Property Manager shall submit (subject to the same procedures as set forth in Section 2.5.1) a revised Budget to the Property Owner before making any expenditure not within the Budget unless the expenditure is (a) less than $25,000, or (b) is, in the Property Manager’s reasonable judgment, required to avoid personal injury, significant property damage, a default under any loan encumbering the Project, a violation of applicable Law or the suspension of a service (collectively, “Permitted Expenditures”).

2.5.3 During each calendar year, in the regular monthly reports sent to the Property Owner, the Property Manager shall inform the Property Owner of any material increases in costs and expenses not foreseen and not included in the Budget within a reasonable time after the Property Manager learns of such changes.

2.5.4 Any controversy arising out of or related to any dispute regarding the Budget as set forth in Section 2.5.1 shall be settled by binding arbitration as provided in Section 13.5.

2.6 Leasing.

2.6.1 The Property Owner hereby approves all Leases, as defined in Section 2.6.2 presently in effect on the date hereof and the Property Manager’s standard lease form, a copy of which is attached hereto and incorporated herein as Exhibit C.

2.6.2 The Property Manager shall use commercially reasonable efforts to obtain tenants for all leasable space in the Project and to renew leases and rental agreements (collectively, “Leases”) as provided herein. The Property Manager shall have the authority to negotiate and execute new and renewal Leases on behalf of the Property Owner. In connection with its leasing efforts, the Property Manager may advertise the Project for lease.

2.6.3 The Property Manager shall not, without the prior written approval of the Property Owner, give free rental or discounts or rental concessions to any employees, officers or shareholders of the Property Manager or anyone related to such employees, officers or shareholders unless such discounts or concessions are disclosed in the Budget or are in lieu of salaries or other benefits to which they would be contractually entitled. The Property Manager shall not lease any space in the Project to itself or to any of its affiliates or subsidiaries.

2.6.4 The Property Manager shall reasonably investigate all prospective tenants, and shall not rent to persons not meeting credit standards reasonable for the market. The Property Manager may, in its discretion, obtain a credit check for all prospective tenants through LexisNexis or a similar service. The Property Manager shall retain such information for the duration of the tenancy, and shall make it available to the Property Owner upon reasonable notice, subject to compliance with any confidentiality restrictions required by any credit check company and any applicable Laws. The Property Manager does not guarantee the accuracy of any such information or the financial condition of any tenant.

2.6.5 The Property Manager and the Property Owner agree that there shall be no intentional discrimination against or segregation of any person or group of persons on account of age, race, color, religion, creed, handicap, sex or national origin in the leasing of the Project, nor shall the Property Manager knowingly permit any such practice or practices of discrimination or segregation with respect to the selection, location, number or occupancy of tenants.

2.6.6 The Property Manager is hereby authorized to execute any and all subordination and non-disturbance agreements, tenant estoppel certificates and tenant notices with respect to the Project, and any and all property tax declaration forms with respect to the acquisition of the Project.

2.7 Collection of Rents and Other Income. Unless otherwise required by any Loan Documents affecting the Project, the Property Manager shall bill all tenants and shall use its commercially reasonable efforts to collect all rent and other charges due and payable from any tenant or from others for services provided in connection with the Project. The Property Manager shall deposit all monies so collected in the Operating Account as defined in Section 6.1.

2.8 Repairs and Maintenance. The Property Manager shall maintain the buildings, appurtenances and common areas of the Project other than areas that are the responsibility of the tenants, including, without limitation, all repairs, cleaning, painting, decorations and alterations, for example electrical, plumbing, carpentry, masonry, elevators and such other routine repairs as are necessary or reasonably appropriate in the course of maintenance of the Project (subject to the limitations of this Agreement). The Property Manager shall pay actual and reasonable expenses for materials and labor for such purposes from the Operating Account.

2.9 Capital Expenditures. The Property Manager, on behalf of the Property Owner, may make any capital expenditure within any Budget approved by the Property Owner without any further consent, provided that the Property Manager follows the bidding procedures prescribed below. All other capital expenditures (other than Permitted Expenditures) shall be subject to submittal of a revised Budget to the Property Owner. Unless the Property Owner specifically waives such requirements, or approves a particular contract, the Property Manager shall award any contract for a capital improvement exceeding $50,000 in cost on the basis of competitive bidding, solicited from a minimum of two (2) written bids. The Property Manager shall accept the bid of the lowest bidder determined by the Property Manager to be responsible, qualified and capable of completing such improvements on a reasonable schedule.

2.10 Service Contracts, Supplies and Equipment.

2.10.1 The Property Manager, on behalf of the Property Owner, may enter into or renew any contract for cleaning, maintaining, repairing or servicing the Project or any of the constituent parts of the Project (including but not limited to contracts for utilities, security or other protection, extermination, landscaping, architectural or engineering services) without the further consent of the Property Owner. Each service contract shall (a) be in the name of the Property Owner or the Property Manager as agent of the Property Owner, (b) be assignable to a successor owner of the Project, and (c) be for a term not to exceed one year unless the circumstances require otherwise in the sole discretion of the Property Manager.

2.10.2 If this Agreement terminates pursuant to Section 10, the Property Manager shall assign to the Property Owner or the nominee of the Property Owner all of the Property Manager’s interest in the service agreements pertaining to the Project or otherwise terminate such service agreements as directed by the Property Owner to the extent the Property Manager and/or Property Owner has the authority to terminate such service agreements.

2.10.3 At the expense of the Property Owner, the Property Manager shall purchase, provide, and pay for any needed janitorial and maintenance supplies, tools and equipment, restroom and toilet supplies, light bulbs, paints, and similar supplies necessary to operate and maintain the Project. Any interest in such supplies and equipment shall be the property of the Property Owner. All such supplies, tools, and equipment generally shall be delivered to and stored at the Project and shall be used only in connection with the management, operation, and maintenance of the Project.

2.10.4 The Property Manager shall use reasonable efforts to purchase all goods, supplies or services at the lowest cost reasonably available from reputable sources.

2.11 Taxes and Mortgages. The Property Manager, unless otherwise requested, shall obtain and verify bills for real estate and personal property taxes, general and special real property assessments and other like charges (collectively “Taxes”) which are, or may become, liens against the Project and appeal such Taxes as the Property Manager may decide, in its reasonable judgment, to be prudent. The Property Manager shall report any such Taxes that materially exceed the amounts contemplated by the Budget to the Property Owner prior to the Property Manager’s payment thereof. The Property Manager, if requested by the Property Owner, will prepare an application for correction of the assessed valuation (in cooperation with the Property Owner) to be filed with the appropriate governmental agency. The Property Manager shall pay, within the time required to obtain discounts, from funds provided by the Property Owner or from the Operating Account, all utilities, Taxes and payments due under each lease, mortgage, deed of trust or other security instrument, if any, affecting the Project. To the extent contemplated by the Budget (as may be revised from time to time), the Property Manager may make any such payments and pay customary rates to tax professionals for related tax services without the additional approval of the Property Owner.

2.12 Miscellaneous Duties. The Property Manager shall (a) maintain at the Property Manager’s office address as set forth in Section 12.1 or at the Project, and readily accessible to the Property Owner, orderly files containing rent records, insurance policies, Leases and subleases, correspondence, receipted bills and vouchers, bank statements, canceled checks, deposit slips, debit and credit memos, and all other documents and papers pertaining to the Project or the operation thereof; (b) provide information about the Project necessary for the preparation and filing by the Property Owner of its income or other tax returns required by any governmental authority, including annual statements,; (c) consider and record tenant service requests in systematic fashion showing the action taken with respect to each; (d) supervise the moving in and out of tenants and, if permitted under the Leases and known to the Property Manager, subtenants; arrange, to the extent possible, the dates thereof to minimize disturbance to the operation of the Project and inconvenience to other tenants; and render an inspection report, an assessment for damages and a recommendation on the disposition of any deposit held as security for the performance by the tenant under its lease with respect to each premises vacated; (e) check all bills received for the services, work and supplies ordered in connection with maintaining and operating the Project and, except as otherwise provided in this Agreement, pay such bills when due and payable; and (f) not knowingly permit the use of the Project for any purpose that might void any policy of insurance held by the Property Owner or that might render any loss thereunder uncollectible. All such records are the property of the Property Owner and will be made available to the Property Owner upon request.

3. Insurance.

3.1 Insurance.

3.1.1 The Property Manager, at the Property Owner’s expense, will, to the extent available at commercially reasonable rates, obtain and keep in force (or require the tenants under the Leases to obtain and keep in force) adequate insurance against physical damage (such as fire with extended coverage endorsement, boiler and machinery) and against liability for loss, damage or injury to property or persons that might arise out of the occupancy, management, operation or maintenance of the Project, as contemplated by the Budget and any Loan Documents affecting the Project. Such insurance shall be obtained for the Property Owner and shall include the Property Owner as a named insured. The Property Manager shall not be required to obtain terrorism, earthquake or flood insurance unless required by the Loan Documents or otherwise expressly directed to do so by a specific written notice from the Property Owner, but may do so in the Property Manager’s reasonable discretion. The Property Manager shall be a named insured on all property damage insurance and an additional insured on all liability insurance maintained with respect to the Project. In the event the Property Manager receives insurance proceeds for the Project, the Property Manager will take any required actions as set forth in any Loan Documents affecting the Project. In the event that the Property Manager receives insurance proceeds that are not governed by the terms of any Loan Documents affecting the Project, the Property Manager will either (a) use such proceeds to replace, repair or refurbish the Project or (b) distribute such proceeds to the Property Owner, as directed by the Property Owner. Any insurance proceeds distributed to the Property Owner will be distributed subject to any fees owed to the Property Manager pursuant to this Agreement. The foregoing notwithstanding, in all events the Property Manager will obtain on behalf of the Property Owner, at the Property Owner’s expense, all applicable insurance coverage as may be required by the terms of any Loan Documents.

3.1.2 The Property Owner acknowledges that the Property Manager is not a licensed insurance agent or insurance expert. Accordingly, the Property Manager shall be entitled to rely on the advice of a reputable insurance broker or consultant regarding the proper insurance for the Project.

3.1.3 Subject to the provisions of any Loan Documents, the Property Manager shall investigate and submit, as soon as reasonably practicable, any required reports to the insurance carrier as to all accidents, claims for damage relating to the ownership, operation and maintenance of the Project, any damage to or destruction of the Project and the estimated costs of repair thereof. Subject to the provisions of any Loan Documents, the Property Manager shall settle all claims, including the execution of proofs of loss, the adjustment of losses, signing and collection of receipts and collection of money.

3.2 Contractor’s and Subcontractor’s Insurance. The Property Manager shall require all contractors and subcontractors entering upon the Project to perform services to have insurance coverage at the contractor’s or subcontractor’s expense, in the following minimum amounts or such other amounts as may be required under the terms of any Loan Documents: (a) worker’s compensation – statutory amount; (b) employer’s liability (if required)—$500,000; and (c) comprehensive general liability insurance, including comprehensive auto liability insurance covering the use of all owned, non-owned and hired automobiles, with bodily injury and property damage limits of $750,000 per occurrence. The Property Manager may waive such requirements in its reasonable discretion. The Property Manager shall obtain and keep on file a certificate of insurance which shows that each contractor and subcontractor is so insured.

3.3 Property Manager’s Insurance. The Property Manager shall maintain, at its own expense, errors and omissions insurance, director and officers insurance and employment practices insurance with a minimum of $1,000,000 in coverage. The Property Manager shall also maintain an employee crime policy with a minimum of $50,000 in coverage.

3.4 Waiver of Subrogation. To the extent available at commercially reasonable rates, all property damage insurance policies required hereunder shall contain language whereby the insurance carrier thereunder waives any right of subrogation it may have with respect to the Property Owner or the Property Manager.

4. Financial Reporting and Record Keeping.

4.1 Books of Accounts. The Property Manager shall maintain adequate and separate books and records for the Project with the entries supported by sufficient documentation to ascertain their accuracy with respect to the Project. The Property Owner agrees to provide to the Property Manager any financial or other information reasonably requested by the Property Manager to carry out its services hereunder. The Property Manager shall maintain such books and records at the Property Manager’s office as set forth in Section 12.1 or at the subcontractor to the Property Manager or at the Project. The Property Manager shall assert such control over accounting and financial transactions as is reasonably necessary to protect the Property Owner’s assets from theft, error or fraudulent activity by the Property Manager’s employees. The Property Manager shall bear the losses arising from the fraud or gross negligence of the Property Manager or any of its employees or agents, including, without limitation, the following: (a) theft of assets by the Property Manager’s employees, principals, or officers or those individuals associated or affiliated with the Property Manager; (b) overpayment or duplicate payment of invoices arising from either fraud or gross negligence, unless credit is subsequently received by the Property Owner within ten (10) days of such overpayment or duplicate payment; (c) overpayment of labor costs arising from either fraud or gross negligence, unless credit is subsequently received by the Property Owner within ten (10) days of such overpayment; (d) overpayment resulting from payment from suppliers to the Property Manager’s employees or agents arising from the purchase of goods or services for the Project; and (e) unauthorized use of facilities by the Property Manager or the Property Manager’s employees or agents.

4.2 Financial Reports. On or about the 20th day following the end of each calendar month, the Property Manager shall furnish to the Property Owner a report of all significant transactions occurring during such prior month. These reports shall include a cash flow statement, a current rent roll and a Property Manager update on the status of the Project. The Property Manager also shall deliver to the Property Owner within sixty (60) days following (a) the end of each calendar year and (b) the termination of this Agreement, a report showing, in summary form, all collections, delinquencies, uncollectible items, vacancies and other matters pertaining to the management, operation, and maintenance of the Project during the prior year or such applicable portion thereof. The annual report shall also contain a statement of income and expenses, a balance sheet for the Project and such other financial information deemed

applicable in the Property Manager’s reasonable discretion. The statement of income and expenses, the balance sheet, and all other financial statements and reports shall be prepared on an accrual basis and in compliance with all reporting requirements relating to the operations of the Project and required under any Loan Documents. If requested by the Property Owner, the Property Manager shall provide financial statements prepared on an accrual basis according, to the extent possible, to generally accepted accounting principles. The Property Manager shall also provide to any lender under any Loan Documents copies of all applicable reports required thereunder that relate to the Project.

4.3 Supporting Documentation. At the expense of the Property Owner, the Property Manager shall maintain and make available at the Property Manager’s office, as set forth in Section 12.1, or at the office of the subcontractor to the Property Manager, at the Project or at a designated office in the region of the Project, copies of the following, if available: (a) all bank statements, bank deposit slips, bank debit and credit memos, canceled checks, and bank reconciliations; (b) detailed cash receipts and disbursement records; (c) trial balance for receivables and payables and billed and unbilled revenue items; (d) rent roll of tenants; (e) paid invoices (or copies thereof); (f) summaries of adjusting journal entries as part of the annual accounting process; (g) supporting documentation for payroll, payroll taxes and employee benefits; (h) appropriate details of accrued expenses and property records; and (i) market study of competition (annually).

4.4 Tax Information. The Property Manager shall provide the Property Owner with sufficient information so that the Property Owner can prepare its income tax returns on the cash method of accounting or, if requested, with appropriate adjustment to convert the information to an accrual basis.

5. Right to Audit. The Property Owner and its representatives, including the lender under the Loan Documents, may examine all books, records and files maintained for the Property Owner by the Property Manager. Any such party may perform any audit or investigations relating to the Property Manager’s activities at any office of the Property Manager if such audit or investigation relates to the Property Manager’s activities for the Property Owner. Should the Property Owner discover defects in internal controls or errors in record keeping, the Property Manager shall undertake with all appropriate diligence to correct such discrepancies either upon discovery or within a reasonable period of time. The Property Manager shall inform the Property Owner in writing of the action taken to correct any audit discrepancies. Any audit or investigation performed by the Property Owner will be conducted at the Property Owner’s sole expense.

6. Bank Accounts.

6.1 Operating Account. To the extent funds are not required to be placed in a lockbox pursuant to any Loan Documents affecting the Project, the Property Manager shall deposit all rents and other funds collected from the operation of the Project in a reputable bank or financial institution in a special trust or depository account or accounts for the Project maintained by the Property Manager for the benefit of the Property Owner. The Property Manager shall maintain books and records of the funds deposited in the accounts and withdrawals therefrom (such accounts together with any interest earned thereon, shall collectively be referred to herein as the “Operating Account”). The Property Manager shall

maintain, with funds from the Property Owner, the Operating Account so that an amount at least as great as the budgeted expenses for such month is in such Operating Account as of the first of each month. The Property Manager shall pay from the Operating Account, on behalf of the Property Owner, the operating expenses of the Project and any other payments relating to the Project as required by this Agreement. If more than one account is necessary to operate the Project, each account shall have a unique name, except to the extent any Lender requires sub-accounts within any account. All rents and other funds collected in the Operating Account after payment of all operating expenses, debt service and such amounts as may be reasonably determined by the Property Manager to be retained for reserves or improvements, shall, unless otherwise provided by any Loan Documents, be paid to the Property Owner.

6.2 Security Deposit Account. The Property Manager shall open, on behalf of the Property Owner, a separate account at a reputable bank or other financial institution for the purpose of segregating security deposits. The Property Manager shall maintain such account in accordance with applicable law and/or the applicable Loan Documents. The Property Manager shall use the account only to maintain security deposits on behalf of the Property Owner. The Property Manager shall require the bank or financial institution to hold the funds in trust for the Property Owner. The Property Manager shall maintain detailed records of all security deposits deposited, and allow the Property Owner or its designees access to such records. Subject to any contrary terms of any Loan Documents, the Property Manager may return such deposits to any tenant in the ordinary course of business in accordance with the terms of the applicable lease and applicable Law.

6.3 Access to Account. As authorized by signature cards, representatives of the Property Manager shall have access to and may draw upon all funds in the accounts described in Sections 6.1 and 6.2 without the approval of the Property Owner. Additionally, representatives of the Property Manager shall have access to and may draw upon any funds escrowed or held in reserve for capital expenditures without the approval of the Property Owner, provided that the requirements of Section 2.9 and any additional Lender requirements with respect to such amounts are satisfied. The Property Owner may not withdraw funds from such accounts without the Property Manager’s prior written consent, except following the Property Manager’s default after expiration of any applicable notice and cure periods or the termination of this Agreement.

7. Payment of Expenses.

7.1 Costs Eligible for Payment from Operating Account. The Property Manager shall pay all expenses of the operation, maintenance and repair of the Project contemplated by the Budget directly from the Operating Account or shall be reimbursed by the Property Owner, subject to the conditions set forth in Section 2.5, including the following to the extent applicable: (a) costs of the gross salary and wages or proportional shares thereof, payroll taxes, payroll processing fees, worker’s compensation insurance, employee education, training and certification and all other benefits of employees (for example, on-site personnel) required to manage, operate and maintain the Project properly, adequately, safely and economically, subject to this Agreement, provided that the Property Manager shall not pay such employees in advance; (b) cost to comply with the terms of any Loan Documents and/or to correct the violation of any governmental requirement relating to the leasing, use, repair and maintenance of the Project, or relating to the Laws, if such cost is not the result of the Property Manager’s gross negligence

fraud or willful misconduct; (c) actual and reasonable cost of making all repairs, decorations and alterations if such cost is not the result of the Property Manager’s gross negligence or willful misconduct; (d) cost incurred by the Property Manager in connection with all service agreements; (e) cost of collection of delinquent rents collected by a collection agency or attorney; (f) legal support fees and reasonable legal fees of attorneys for the costs of services otherwise provided herein; (g) cost of capital expenditures subject to the restrictions in Section 2.9 and in this Section; (h) cost of printed checks for each account required for the Project and the Property Owner; (i) cost of utilities and costs associated with utility billing; (j) cost of advertising, marketing and resident surveys; (k) cost of printed forms and supplies required for use at the Project; (l) management compensation set forth in Section 9; (m) the cost of tenant improvements to the Project subject to the restrictions in Section 2.9 and this Section 7.1; (n) all hiring, relocation and termination costs for any employees whose salaries and benefits are paid by the Property Owner; (n) brokers’ commissions; (o) debt service; (p) the cost of utilities, services, contractors and insurance; (q) reimbursement of the Property Manager’s out-of-pocket costs and expenses to the extent not prohibited by Section 8; (r) general accounting and reporting services within the reasonable scope of the Property Manager’s responsibility to the Property Owner; (s) cost of forms, papers, ledgers, postage and other supplies and equipment (including computer equipment) used in the Property Manager’s office at any location; (t) computer/information technology (IT) support and the cost of electronic data processing equipment, including personal computers located at the Property Manager’s office at the Project for preparation of reports, information and returns to be prepared by the Property Manager under the terms of this Agreement; (u) cost of electronic data processing provided by computer service companies for preparation of reports, information and returns to be prepared by the Property Manager under the terms of this Agreement, including but not limited to any costs associated with Yardi or similar property management software; (v) travel and entertainment expenses intended to advance the interests of the Project; and (w) cost of routine travel by the Property Manager’s employees or agents to and from Project. In the alternative, the Property Manager may charge a monthly flat fee for the above services, which flat fee is subject to the approval of the Property Owner. All other amounts not directly related to the Project or the Property Owner shall be payable solely by the Property Manager, and shall not be paid out of the Operating Account or reimbursed by the Property Owner.

7.2 Operating Account Deficiency. If there are not sufficient funds in the Operating Account (or any reserve account held by the Lender) to make any required payment, the Property Manager shall notify the Property Owner, if possible, at least ten (10) days prior to any such delinquency so that the Property Owner has an opportunity to deposit sufficient funds into the Operating Account (or, if applicable, any reserve account held by the Lender) to allow for payment prior to the imposition of any penalty or late charge. In no event shall the Property Manager be required to expend any of its own funds for the operation or maintenance of the Project; however, should it do so, the Property Manager shall be entitled to reimbursement from the Property Owner within thirty (30) days after such advance.

7.3 Interest on Funds Advanced or Loaned by the Property Manager. Subject to the approval of the Property Owner, the Property Manager may (but shall not be obligated to) loan funds to the Property Owner in the future, with simple interest thereon at the rate of fifteen percent (15%) per annum (or, if lower, the highest rate permitted by Law). Such loan, if any, shall be full recourse to the Property Owner and must be repaid within thirty (30) days of funding.

8. Property Manager’s Costs Not To Be Reimbursed.

8.1 Non-Reimbursable Costs. Costs attributable to losses arising from the gross negligence or fraud on the part of the Property Manager, the Property Manager’s agents or employees shall be at the sole cost and expense of the Property Manager and shall not be reimbursed by the Property Owner.

8.2 Litigation. The Property Manager will be responsible for and hold the Property Owner harmless from, all fees, costs, expenses, and damages relating to criminal activity involving employees, disputes with employees for worker’s compensation (to the extent not covered by insurance), discrimination or wrongful termination, including legal fees and other expenses, where it is determined by final judicial determination that such loss, cost or expense was the fault of the Property Manager.

9. Compensation. The Property Manager and its Affiliates will receive the compensation set forth on Schedule 1.

10. Termination.

10.1 Termination by Property Owner. The Property Owner shall have the right to terminate this Agreement upon thirty (30) days prior written notice from the Property Owner to the Property Manager indicating its’ termination of the Agreement or such shorter time as directed by a Lender pursuant to the terms of any applicable Loan Documents.

10.2 Termination by the Property Manager. The Property Manager shall have the right to terminate this Agreement upon thirty (30) days prior written notice from the Property Manager to the Property Owner indicating its’ termination of the Agreement.

10.3 Termination on Sale. This Agreement shall automatically terminate upon the sale of the entire Project.

10.4 Termination on Advisory Agreement Termination. This Agreement shall automatically terminate upon Property Manager receiving written notification from Owner that the Advisory Agreement has terminated,

10.5 Final Accounting. Within forty-five (45) days after termination of this Agreement for any reason, the Property Manager shall deliver to the Property Owner the following: (a) a final accounting, setting forth the balance of income and expenses on the Project as of the date of termination; (b) transfer to any account indicated by the Property Owner any balance or monies of the Property Owner or tenant security deposits held by the Property Manager with respect to the Project (or transfer the accounts in which such sums are held as instructed by the Property Owner); and (c) deliver to a subsequent property manager or other agent indicated by the Property Owner all materials and supplies, keys, books and records, contracts, leases, receipts for deposits, unpaid bills and other papers or documents which pertain to the Project. For a period of forty-five (45) days after such expiration or cancellation for any reason other than the Property Owner’s default, the Property Manager shall be available, through its senior executives familiar with the Project, to consult with and advise the Property Owner or any person or entity succeeding to the Property Owner as owner of the Project or such other

person or persons selected by the Property Owner regarding the operation and maintenance of the Project. In addition, the Property Manager shall cooperate with the Property Owner in notifying all tenants of the Project of the expiration and termination of this Agreement, and shall use reasonable efforts to cooperate with the Property Owner to accomplish an orderly transfer of the operation and management of the Project to a party designated by the Property Owner. The Property Manager shall receive its monthly Property Management Fee for such services. The Property Manager shall, at its cost and expense, promptly remove all signs wherever located indicating that it is the Property Manager and replace and repair any damage resulting therefrom. Termination of this Agreement shall not release either party from liability for failure to perform any of the duties or obligations as expressed herein and required to be performed by such party for the period prior to the termination.

10.6 Debts and Obligations of the Property Owner. In the performance of its duties hereunder, the Property Manager and its affiliates, shall act on behalf of the Property Owner solely in their capacity as the Property Owner’s agent. All debts and obligations to third parties incurred by the Property Manager or its affiliates, in relation to the Project, shall be the debts and obligations of the Property Owner, and neither the Property Manager, nor its affiliates, shall be liable for, and shall be indemnified by, the Property Owner for any such debts, liabilities or obligations. The Property Manager and its affiliates shall have no obligation or responsibility to make payments with their own funds on any indebtedness incurred on behalf of the Property Owner or the Project, whether secured by the Project, or any portion thereof. Furthermore, this Agreement shall not be terminated by the Property Owner until all existing debts, liabilities and obligations arising out of any loan or the payment for goods or services on behalf of the Project are paid in full or assumed by a successor property manager; any guarantees entered into or made by the Property Manager, its affiliates, principles or officers on behalf of the Project are extinguished; and all fees owed to the Property Manager and its affiliates have been paid in full.

11. Conflicts. The Property Manager shall not deal with or engage, or purchase goods or services from, any subsidiary or affiliated company of the Property Manager in connection with the management of the Project for amounts above market rates.

12. Notices. All notices, demands, consents, approvals, reports and other communications to the Property Owner as provided for in this Agreement shall be in writing and shall be given to the Property Owner as set forth below, or at such other address as they may specify hereafter in writing. All notices, demands, consents, approvals, reports, and other communications to the Property Manager provided for in this Agreement shall be in writing and shall be given to the Property Manager at the address set forth below or at such other address as it may specify hereafter in writing:

To the Property Manager at:

Cottonwood Communities Management, LLC

c/o Cottonwood Residential, Inc.

6340 South 3000 East, Suite 500

Salt Lake City, Utah 84121

Attention: General Counsel

To the Property Owner:

KRE JAG One Upland Owner LLC

c/o Cottonwood Communities, Inc.

6340 South 3000 East, Suite 500

Salt Lake City, Utah 84121

Attention: General Counsel

Any notice or other communication that is not emailed may be delivered by a recognized overnight delivery service providing a receipt, facsimile transmission or mailed by United States registered or certified mail, return receipt requested, postage prepaid if deposited in a United States Post Office or depository for the receipt of mail regularly maintained by the post office. Notices sent by overnight courier shall be deemed given one (1) business day after mailing; notices sent by registered or certified mail shall be deemed given two (2) business days after mailing; and notices sent by facsimile transmission shall be deemed given as of the date sent (if sent prior to 5:00 p.m. MT and if receipt has been acknowledged by the operator of the receiving machine). Notices sent via e-mail shall be deemed given as of the date sent (if sent prior to 5:00 p.m. MT and if the Property Manager does not receive a “bounce back” notice that the e-mail transmission was not completed).

13. Miscellaneous.

13.1 Assignment. The Property Manager may not assign this Agreement without the prior written consent of the Property Owner, which consent may be withheld in the Property Owner’s sole and absolute discretion, except with respect to an assignment to an affiliate, including, but not limited to a wholly-owned subsidiary, which shall be permissible under this Agreement.

13.2 Gender. Each gender shall include each other gender. The singular shall include the plural and vice-versa.

13.3 Amendments. Each amendment, addition or deletion to this Agreement shall not be effective unless approved by the parties in writing, except as otherwise provided herein.

13.4 Attorneys’ Fees. In any action or proceeding between the Property Manager and the Property Owner arising from or relating to this Agreement or the enforcement or interpretation hereof, the party prevailing in such action or proceeding shall be entitled to recover from the other party all of its reasonable attorneys’ fees and other costs and expenses of the action or proceeding.

13.5 Binding Arbitration. Any controversy between the parties hereto arising out of or related to this Agreement or the breach thereof shall be settled by arbitration in Salt Lake City, Utah, in accordance with the rules of The American Arbitration Association, and judgment entered upon the award rendered may be enforced by appropriate judicial action. The arbitration panel shall consist of one member, which shall be the mediator if mediation has occurred or shall be a person agreed to by each party to the dispute within thirty (30) days

following notice by one party that he or she desires that a matter be arbitrated. If there was no mediation and the parties are unable within such thirty (30) day period to agree upon an arbitrator, then the panel shall be one arbitrator selected by the Denver, Colorado office of The American Arbitration Association, which arbitrator shall be experienced in the area of real estate and limited liability companies and who shall be knowledgeable with respect to the subject matter area of the dispute. The losing party shall bear any fees and expenses of the arbitrator, other tribunal fees and expenses, reasonable attorneys’ fees of both parties, any costs of producing witnesses and any other reasonable costs or expenses incurred by the losing party or the prevailing party or such costs shall be allocated by the arbitrator. The arbitration panel shall render a decision within thirty (30) days following the close of presentation by the parties of their cases and any rebuttal. The parties shall agree within thirty (30) days following selection of the arbitrator to any prehearing procedures or further procedures necessary for the arbitration to proceed, including interrogatories or other discovery; provided, in any event each party shall be entitled to discovery in accordance with applicable Utah law.

13.6 Governing Law; Venue. This Agreement shall be governed by and construed in accordance with the internal laws of the State of Utah without regard to any choice of law rules. Any action relating to or arising out of this Agreement shall be brought only in a court of competent jurisdiction located in Salt Lake City, Utah.

13.7 Headings. All headings are only for convenience and ease of reference and are irrelevant to the construction or interpretation of any provision of this Agreement.

13.8 Representations. The Property Manager represents and warrants that it is or shall become fully qualified and licensed, to the extent required by applicable Law, to manage and lease real estate and perform all obligations assumed by the Property Manager hereunder. The Property Manager shall use reasonable efforts to comply with all such laws now or hereafter in effect. If at any time it is determined that the Property Manager does not have all applicable licenses or qualifications, the Property Manager shall be given a reasonable opportunity to cure such deficiency by obtaining any required licenses or permits.

13.9 Indemnification by Property Manager. The Property Manager shall indemnify, defend and hold the Property Owner and its shareholders, officers, directors, members, partners and employees harmless from any and all claims, demands, causes of action, losses, damages, fines, penalties, liabilities, costs and expenses, including reasonable attorneys’ fees and court costs, sustained or incurred by or asserted against the Property Owner where it is determined by final judicial determination that such loss, cost or expense was the result of the acts of the Property Manager which arise out of the gross negligence, willful misconduct or fraud of the Property Manager, its agents or employees or the Property Manager’s material breach of this Agreement. If any person or entity makes a claim or institutes a suit against the Property Owner on a matter for which the Property Owner claims the benefit of the foregoing indemnification, then (a) the Property Owner shall give the Property Manager prompt notice thereof in writing; (b) the Property Manager may defend such claim or action by counsel of its own choosing provided such counsel is reasonably satisfactory to the Property Owner; and (c) neither the Property Owner nor the Property Manager shall settle any claim without the other’s written consent.

13.10 Indemnification by the Property Owner. The Property Owner shall indemnify, defend and hold the Property Manager and its shareholders, members, partners, officers, directors, managers and employees harmless from any and all claims, demands, causes of action, losses, damages, fines, penalties, liabilities, costs and expenses, including reasonable attorneys’ fees and court costs, sustained or incurred by or asserted against the Property Manager by reason of the operation, management, and maintenance of the Project and the performance by the Property Manager of the Property Manager’s obligations under this Agreement, except those which arise from the Property Manager’s negligence, misconduct or fraud. If any person or entity makes a claim or institutes a suit against the Property Manager on matters for which the Property Manager claims the benefit of the foregoing indemnification, then (a) the Property Manager shall give the Property Owner prompt notice thereof in writing; (b) the Property Owner may defend such claim or action by counsel of its own choosing provided such counsel is reasonably satisfactory to the Property Manager; (c) neither the Property Manager nor the Property Owner shall settle any claim without the other’s written consent; and (d) this subsection shall not be so construed as to release the Property Owner or the Property Manager from any liability to the other for a breach of any of the covenants agreed to be performed under the terms of this Agreement.

13.11 Complete Agreement. This Agreement shall supersede and take the place of any and all previous agreements entered into between the parties with respect to the Project.

13.12 Severability. If any provisions of this Agreement or application to any party or circumstances shall be determined by any court of competent jurisdiction to be invalid and unenforceable to any extent, the remainder of this Agreement, where the application of such provisions or circumstances other than those as to which it is determined to be invalid or unenforceable shall not be affected thereby, and each provision hereof shall be valid and shall be enforced to the fullest extent permitted by law.

13.13 No Waiver. The failure by any party to insist upon the strict performance of, or to seek remedy of, any one of the terms or conditions of this Agreement or to exercise any right, remedy, or election set forth herein or permitted by law shall not constitute or be construed as a waiver or relinquishment for the future of such term, condition, right, remedy or election, but such item shall continue and remain in full force and effect. All rights or remedies of the parties specified in this Agreement and all other rights or remedies that they may have at law, in equity or otherwise shall be distinct, separate and cumulative rights or remedies, and no one of them, whether exercised or not, shall be deemed to be in exclusion of any other right or remedy of the parties.

13.14 Binding Effect. This Agreement shall be binding and inure to the benefit of the parties and their respective successors and assigns.

13.15 Counterparts. This Agreement may be executed in several counterparts, which when executed shall constitute one Agreement, binding on all of the parties hereto, notwithstanding that all of the parties are not signatory to the original or the same counterpart.

13.16 Waiver of Right to Jury Trial. THE PROPERTY OWNER AND THE PROPERTY MANAGER EACH KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE TO THE EXTENT PERMITTED BY LAW, TRIAL BY JURY IN ANY ACTIONS BROUGHT BY OR AGAINST THE PROPERTY OWNER OR THE PROPERTY MANAGER IN CONNECTION WITH THIS AGREEMENT.

[Signatures on following page.]

IN WITNESS WHEREOF the parties hereby execute this Agreement to be effective as of the date set forth above.

PROPERTY MANAGER:
COTTONWOOD COMMUNITIES MANAGEMENT, LLC, a Delaware limited
liability company
By:	Cottonwood Capital Management, Inc., a
	Delaware corporation, its sole member
By:	/s/ Gregg T. Christensen
Name:	Gregg T. Christensen
Title:	Chief Legal Officer
PROPERTY OWNER:
KRE JAG ONE UPLAND OWNER LLC, a Delaware limited liability company
By:	CC ONE UPLAND, LLC, a Delaware limited
	liability company, its Sole Member
	By:	COTTONWOOD COMMUNITIES O.P.,
		LP, a Delaware limited partnership, its Sole Member
		By:	Cottonwood Communities, Inc., a
			Maryland corporation, its General Partner
		By:	/s/ Gregg T. Christensen
			Gregg T. Christensen
			Chief Legal Officer

SCHEDULE 1

FEES TO PROPERTY MANAGER & AFFILIATES

The Property Manager and its Affiliates will receive the following compensation:

• Property Management Fee. The Property Manager, or an affiliate, shall receive, for its services in managing the day-to-day operations of the Project in accordance with the terms of this Agreement, an annual property management fee (the “Property Management Fee”) equal to 3.5% of the Gross Revenues (as defined below) and prorated for any partial year, payable in monthly installments, which Property Management Fee shall be in addition to any out-of-pocket and on-site personnel costs that are reimbursable pursuant to Section 7. “Gross Revenues” shall be all gross billings from the operations of the Project including rental receipts, late fees, application fees, pet fees, damages, lease buy-out payments, and reimbursements by tenants for common area expenses, operating expenses and Taxes and similar pass-through obligations paid by tenants, but excluding (i) security deposits received from tenants and interest accrued thereon for the benefit of the tenant until such deposits or interest are included in the taxable income of the Property Owner; (ii) advance rents (but not lease buy-out payments) until the month in which payments are to apply as rental income; (iii) reimbursements by tenants for work done for that particular tenant, (iv) proceeds from the sale or other disposition of all or any part of the Project, (v) insurance proceeds received by the Property Owner as a result of any insured loss (except proceeds from rent insurance or the excess of insurance proceeds for repairs over the actual costs of such repairs), (vi) condemnation proceeds not attributable to rent, (vii) capital contributions made by the Property Owner; (viii) proceeds from capital, financing and any other transactions not in the ordinary course of the operation of the Project, (ix) income derived from interest on investments or otherwise, (x) abatement of Taxes, awards arising out of takings by eminent domain, discounts and dividends on insurance policies, and (xi) rental concessions not paid by third parties. The Property Management Fee shall be payable monthly from the Operating Account or from other funds timely provided by the Property Owner. Upon termination of this Agreement, the parties will prorate the Property Management Fee on a daily basis to the effective date of such cancellation or termination. Upon a sale of the Project, the Property Manager shall receive additional compensation equal to the previous month’s Property Management Fee as compensation for work to be performed in connection with the sale or completion of managing matters relating to each tenant. The Property Management Fee will be paid monthly in arrears.

EXHIBIT A

LEGAL DESCRIPTION

Parcel One

That certain parcel of land in Norwood, Norfolk County, Massachusetts shown as Lot 4A on a plan entitled “Campanelli Thorndike Norwood LLC, Lot 4A - Upland Woods Lower Road, Norwood, MA” prepared by Kelly Engineering Group, Inc. dated October 10, 2014 recorded with the Norfolk County Registry of Deeds in Plan Book 635, Page 22.

Parcel Two

Together with the benefits of the Access Easement for Use of Common Areas and other easements set forth in Paragraph 8 of the Park Covenants and Maintenance Agreement by and between CFRI/CQ Norwood Upland, L.L.C. and Upland Woods Management LLC dated February 10, 2005 recorded in Book 22094, Page 439 and filed as Document No. 1055346, as amended by First Amendment to Park Covenants and Maintenance Agreement dated September 22, 2017 and recorded October 26, 2017 in Book 35548, Page 179.

Parcel Three

Together with the benefit of the Utility and Sewer Easement Agreement dated as of November 14, 2014 by and between CFRI/CQ Norwood Upland L.L.C. and Campanelli Thorndike Norwood LLC recorded in Book 32699 Page 206 as amended by Amendment to Utility and Sewer Easement Agreement between Campanelli-Trigate Norwood Upland, L.L.C. and Campanelli Thorndike Norwood LLC dated as of June 29, 2017 recorded June 30, 2017 in Book 35240 Page 176.

EXHIBIT B

BUDGET

[see attached]

EXHIBIT C

FORM LEASE

[see attached]

EX-10.19

Exhibit 10.19

COTTONWOOD COMMUNITIES, INC.

FORM OF PERFORMANCE-BASED

LTIP UNIT AWARD AGREEMENT

Name of the Participant:                      (the “Participant”)

Performance Period: [            ] [    ], 2020 through [            ] [    ], 2022

Grant Date Net Asset Value:                     

No. of LTIP Units Issued:                     

Grant Date: [            ] [    ], 2020

RECITALS

A.    Cottonwood Communities, Inc., a Maryland corporation (the “Company”) wishes to reward and incentivize the Participant, who performs valuable services for the benefit of the Company and Cottonwood Communities O.P., L.P., a Delaware partnership (the “Partnership” and, together with the Company, “Cottonwood”).

B.    Pursuant to the Amended and Restated Limited Partnership Agreement (as amended and supplemented from time to time, the “LP Agreement”) of the Partnership, the Company hereby grants the Participant this award (the “Award”) and hereby causes the Partnership to issue to the Participant, the number of LTIP Units (as defined in the LP Agreement) set forth above (the “Award LTIP Units”) having the rights, voting powers, restrictions, limitations as to distributions, qualifications and terms and conditions of redemption and conversion set forth herein and in the LP Agreement. Unless otherwise indicated, capitalized terms used herein but not otherwise defined shall have the meanings given to those terms in the LP Agreement.

C.    The Board of Directors of the Company (the “Board”) or the Compensation Committee of the Board (either such entity shall be referred to herein as the “Committee”) has determined that the Participant is entitled to receive the Award LTIP Units. The exact number of LTIP Units deemed earned shall be determined following the conclusion of the Performance Period based on the Performance Vesting Percentage as provided for herein such that the LTIP Units will become fully vested on the first anniversary of the last day of the Performance Period, subject to continued employment with the Company. Any Award LTIP Units not earned upon the end of the Performance Period will be forfeited.

NOW, THEREFORE, the Company, the Partnership and the Participant agree as follows:

1.    Effectiveness of Award. The Participant shall be admitted as a partner of the Partnership with beneficial ownership of the Award LTIP Units as of the Grant Date by (i) signing and delivering to the Partnership a copy of this Agreement and (ii) signing, as a Limited Partner, and delivering to the Partnership a counterpart signature page to the LP Agreement (attached hereto as Exhibit A). Upon execution of this Agreement by the Participant, the Partnership and the Company, the books and records of the Partnership maintained by the General Partner shall reflect the issuance to the Participant of the Award LTIP Units. Thereupon, the Participant shall have all the rights of a Limited Partner of the Partnership with respect to a number of LTIP Units equal to the Award LTIP Units, subject, however, to the restrictions and conditions specified in Section 2 below and elsewhere herein. The LTIP Units are uncertificated securities of the Partnership and upon the Participant’s request the General Partner shall confirm the number of LTIP Units issued to the Participant.

2.    Vesting and Earning of Award LTIP Units.

(a)    This Award is subject to performance vesting and a continuous service requirement during and for one additional year following the end of the Performance Period. The Award LTIP Units will be subject to forfeiture based on the Company’s performance to the extent provided in this Agreement. On a date (the “Determination Date”) within 75 calendar days after the earlier of the end of the Performance Period or the effective date of a Change in Control (as defined below) (the “Measurement Date”), the Committee shall calculate the number of LTIP Units that were earned as follows:

(b)     (i)    The number of LTIP Units deemed earned will equal the product of (A) the number of Award LTIP Units multiplied by (B) the Performance Vesting Percentage (the “Earned Units”).

(ii)    The Committee shall calculate the number of additional LTIP Units that would have accumulated if the Participant had received all distributions paid by the Partnership from the Grant Date to the Determination Date with respect to the Earned Units (reduced by the distributions actually paid with respect to the Award LTIP Units) and such distributions had been invested in Common Limited Partnership Units at a price equal to the fair market value of one Common Limited Partnership Unit on the ex-dividend date (together with Earned Units, the “Earned LTIP Unit Equivalent”).

For purposes of this Section 2(b), the following terms shall have the following meanings:

(A)    The “Internal Rate of Return” shall be equal to the annualized discount rate (calculated using the “XIRR” function of Microsoft Excel, or if such function no longer exists at the time of such calculation, a comparable methodology) that causes the net present value of investing the Grant Date Net Asset Value in one share of Common Stock on the Grant Date to equal the net present value of (i) all dividends and distributions paid with respect to one share of Common Stock with a record date occurring during the Performance Period (including all dividends and distributions paid with respect to such additional securities) and (ii) the Share Value (as defined below) on the Measurement Date.

(B)    The “Performance Vesting Percentage” shall be equal to the percentage set forth below opposite the actual Internal Rate of Return calculated in the manner set forth above.

Internal Rate of Return	Performance Vesting Percentage*
Less than 6.0%	0%
6.0%	50%
6 to 10%	50 to 100%

* If the Internal Rate of Return is between 6.0% and 10.0%, then the Performance Vesting Percentage will be determined by linear interpolation between 50% and 100% (e.g., an Internal Rate of Return of 8.0% would result in a Performance Vesting Percentage of 75%).

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(C)    “Per Share Net Asset Value” on any date shall mean (i) if the shares of Common Stock of the Company are not listed or admitted to trade on a national securities exchange, the most recent price per share of Common Stock as a majority of the Board determines in good faith, and (ii) if the shares of Common Stock of the Company are listed or admitted to trade on a national securities exchange, the average closing price per share of Common Stock for the previous 30 trading dates, including such date (or such fewer number of trading days as such shares have traded on such exchange, if such number of trading days is fewer than 30). Any determination of Per Share Net Asset Value made in good faith by the Board in accordance with this Agreement shall be final, binding and conclusive on all parties.

(D)    The “Share Value” as of the Measurement Date shall generally be equal to the Per Share Net Asset Value, plus the value, calculated in the same manner as the Per Share Net Asset Value, of any securities of Cottonwood paid with respect to a share of Common Stock during the Performance Period. Notwithstanding the foregoing, if the Measurement Date is the effective date of a Change of Control, the Share Value shall be equal to the cash value, as determined by the Board in good faith, of the consideration paid in the transaction for one share of Common Stock, plus the cash value, as determined by the Board of Directors in good faith, of the consideration paid in the Change of Control for any securities of Cottonwood paid with respect to one share of Common Stock during the Performance Period. In the event that the transaction that results in a Change of Control does not involve the payment of any consideration for shares of Common Stock or other securities of Cottonwood, the Board shall determine, in good faith, the value of shares of Common Stock or such other securities of Cottonwood imputed by the transaction; provided, however, that if no value can be imputed from the transaction, then the value of shares of Common Stock or such other securities of Cottonwood shall be determined in the same manner as it would have been if the Measurement Date had not been the effective date of a Change of Control. The Board may from time to time employ a third-party appraiser to review and certify the Board’s methodology for determining Share Value. For purposes of this Agreement, if the Share Value is calculated at a later date than the Grant Date or Measurement Date but is intended to represent the value on that Grant Date or Measurement Date, then that value shall be the Share Value of the Grant Date or Measurement Date. (For example, if on March 1st the Board of Directors were to approve a Share Value for the preceding December 31^st and the Grant Date was on the preceding January 1^st then that calculation will be the Share Value for the purposes of calculating the Performance Vesting Percentage and applicable Share Value). Any determination of Share Value made in good faith by the Board pursuant to this Agreement shall be final, binding and conclusive on all parties.

(c)    Earned LTIP Unit Equivalent Compared to Award LTIP Units. If the Earned LTIP Unit Equivalent is smaller than the aggregate number of Award LTIP Units previously issued to the Participant, then the Participant shall forfeit a number of Award LTIP Units equal to the difference without payment of any consideration by the Partnership; thereafter the term Award LTIP Units will refer only to the Award LTIP Units that were not so forfeited and neither the Participant nor any of his or her successors, heirs, assigns, or personal representatives will thereafter have any further rights or interests in the LTIP Units that were so forfeited. If the Earned LTIP Unit Equivalent is greater than the number of Award LTIP Units previously issued to the Participant, then, upon the performance of the calculations set forth in Section 2(b): (A) the Company shall cause the Partnership to issue to the Participant, as of the Measurement Date, a number of additional LTIP Units equal to the difference; (B) such additional LTIP Units shall be added to the Award LTIP Units previously issued, if any, and thereby become part of this Award (provided that such additional LTIP Units shall be treated as being issued as of the date they are actually issued for purposes of determining their holding period under the LP Agreement); (C) the

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Company and the Partnership shall take such corporate and partnership action as is necessary to accomplish the grant of such additional LTIP Units; and (D) thereafter the term Award LTIP Units will refer collectively to the Award LTIP Units, if any, issued prior to such additional grant plus such additional LTIP Units; provided that such issuance will be subject to the Participant confirming the truth and accuracy of the representations set forth in Section 14 hereof and executing and delivering such documents, comparable to the documents executed and delivered in connection with this Agreement, as the Company and/or the Partnership reasonably request in order to comply with all applicable legal requirements, including, without limitation, federal and state securities laws. If the Earned LTIP Unit Equivalent is the same as the number of Award LTIP Units previously issued to the Participant, then there will be no change to the number of Award LTIP Units.

(d)    Continuous Service Vesting. The Award LTIP Units as calculated under Sections 2(b) and (c) (the “Earned LTIP Units”) shall be subject to continuous service vesting as follows:

(i)    100 percent of the Earned LTIP Units shall become vested on the first anniversary of the last day of the Performance Period, conditioned on the Participant’s continued employment with the Company.

(ii)    If a Change in Control occurs following the end of the Performance Period but prior to the vesting of the Earned LTIP Units, any unvested Earned LTIP Units shall become fully vested.

(e)    Termination of Employment. The continuous service requirements of Section 2(a) of this Agreement shall be applied to this Award as follows:

(i)    In the event of termination of the Participant’s employment (A) by the Participant for Good Reason, (B) by the Company without Cause or (C) by reason of the Participant’s death or disability (each a “Qualified Termination”) after the Grant Date, but prior to the end of the Performance Period, the Participant will retain the number of Award LTIP Units previously granted to him or her with respect to the Performance Period, but the following provisions shall modify the determination and vesting of the Award LTIP Units for the Participant:

(A)    the calculations provided in Sections 2(b) and (c) hereof shall be performed as of the Measurement Date as if the Qualified Termination had not occurred;

(B)    the Award LTIP Units calculated pursuant to Sections 2(b) and (c) shall be multiplied by the Partial Service Factor (as defined below) (with the resulting number being rounded to the nearest whole LTIP Unit or, in the case of 0.5 of a unit, up to the next whole unit), and such adjusted number of LTIP Units shall be deemed the Participant’s Earned LTIP Units for all purposes under this Agreement. All such Earned LTIP Units shall be fully vested on the date the Committee makes the determination under Section 2(b).

Notwithstanding anything herein to the contrary, to the extent the Participant is party to an employment agreement with the Employer that provides for the treatment of unvested equity awards in certain employment terminations, and subject to compliance by the Participant with the requirements of such employment agreement related to such termination, the vesting of any unvested Award LTIP Units shall be subject to the terms of such employment agreement.

(ii)    In the event of a Qualified Termination after the end of the Performance Period but prior to the first anniversary thereof, the Participant will become fully vested in his or her Earned LTIP Units.

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(iii)    In the event of a termination of the Participant’s employment for any reason other than a Qualified Termination, then all unvested Award LTIP Units or Earned LTIP Units, as applicable, shall, without payment of any consideration by the Company, automatically and without notice terminate, be forfeited and be and become null and void, and neither the Participant nor any of his or her successors, heirs, assigns, or personal representatives will thereafter have any further rights or interests in any such unvested Award LTIP Units or Earned LTIP Units.

(f)    Change in Control. If a Change in Control occurs prior to the end of the Performance Period, the Measurement Date shall be the effective date of the Change in Control, and the Earned LTIP Units shall become fully vested.

3.    Distributions. The Participant shall be entitled to receive distributions with respect to the Award LTIP Units to the extent provided for in the LP Agreement as follows:

(a)    The Award LTIP Units are hereby designated as “Special LTIP Units.”

(b)    The LTIP Unit Distribution Participation Date with respect to the Award LTIP Units is the Grant Date set forth in this Agreement.

(c)    The Special LTIP Unit Full Participation Date with respect to the Earned LTIP Units is the date on which the Earned LTIP Unit Equivalent is determined pursuant to the applicable clause of Section 2 hereof.

(d)    The Special LTIP Unit Sharing Percentage with respect to the Award LTIP Units is 10 percent.

(i)    The Special LTIP Unit Sharing Percentage multiplied by the Award LTIP Units will determine the number of the Special LTIP Units that are qualified to receive distributions during the period which is after the Grant Date but before the date on which the Earned LTIP Unit Equivalent is determined. Distributions to be paid on an Award LTIP Units or Earned LTIP Units will equal the distribution paid on a Common Unit at the time the distribution is paid.

(e)    All distributions paid with respect to the Award LTIP Units or Earned LTIP Units shall be fully vested and non-forfeitable when paid, whether or not the Award LTIP Units have been earned based on performance or have become vested based on continued employment as provided in Section 2 hereof.

4.    Adjustments. The Award LTIP Units and Earned LTIP Units shall be subject to adjustment in the circumstances described in and in accordance with the LP Agreement.

5.    Compensation Recoupment Policy. This Award shall be subject to any compensation recoupment policy of the Company that is applicable by its terms to the Participant and to Awards of this type.

6.    Interpretation by Committee. This Agreement is subject in all respects to the terms, conditions, limitations and definitions contained in the LP Agreement. In the event of any discrepancy or inconsistency between this Agreement and the LP Agreement, the terms and conditions of the LP Agreement shall control except that in the case of a Change in Control, the provisions of this Agreement shall control. The Committee may make such rules and regulations and establish such procedures for the administration of this Agreement as it deems appropriate. Without limiting the generality of the

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foregoing, the Committee may interpret this Agreement, with such interpretations to be conclusive and binding on all persons and otherwise accorded the maximum deference permitted by law. In the event of any dispute or disagreement as to interpretation of the Agreement or of any rule, regulation or procedure, or as to any question, right or obligation arising from or related to this Agreement, the decision of the Committee shall be final and binding upon all persons.

7.    Defined Terms. For purposes of this Agreement, the following defined terms shall have the meanings specified herein:

(a)    “Cause” means (a) if the Participant is a party to an employment agreement with the Employer, and “Cause” is defined therein, such definition, or (b) if the Participant is not party to an employment agreement that defines “Cause,” Cause shall mean, (i) conduct by the Participant which would reasonably be expected to result in material injury or reputation harm to the Employer; (ii) conduct by the Participant constituting gross negligence or willful misconduct in the performance of his or her duties; (iii) the material violation by the Participant of any written policy and ethics, as in effect on the Grant Date and as subsequently changed from time to time; or (iv) the commission by the Participant of any felony or a misdemeanor involving moral turpitude, deceit, dishonesty or fraud.

(b)    “Change in Control” means: (i) the acquisition in one or more transactions by any Person, of the beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as amended) of 50% or more of (A) the then outstanding shares of Common Stock, or (B) the combined voting power of the then outstanding securities of the Company entitled to vote generally in the election of directors; (ii) the closing of a sale or other conveyance of all or substantially all of the assets of the Company or the Partnership other than a sale or other conveyance by the Company to an entity at least 50% of the combined voting power of the voting securities of which are owned by the stockholders of the Company in substantially the same proportion as their ownership of the Common Stock immediately prior to such sale or other conveyance; (iii) the effective time of any merger, share exchange, consolidation, or other business combination involving the Company or a direct or indirect subsidiary of the Company that results in the voting securities of the Company outstanding immediately prior to such transaction representing (either by remaining outstanding or by being converted into voting securities of the surviving entity or its parent) less than 50% of the combined voting power of the securities of the surviving entity or its parent outstanding immediately after such transaction; or (iv) a Capital Transaction. For the avoidance of doubt, an initial public offering of Common Stock shall not be considered a Change in Control for purposes of this Agreement.

(c)    “Common Stock” means shares of common stock of the Company.

(d)    “Employer” means either the Company, the Partnership or any affiliate that employs the Participant.

(e)    “Good Reason” means (a) if the Participant is party to an employment agreement with the Employer, and “Good Reason” is defined therein, such definition, or (b) if the Participant is not party to an employment agreement that defines “Good Reason,” Good Reason shall mean that the Participant has complied with the “Good Reason Process” (hereinafter defined) following the occurrence of any of the following events: (i) a material diminution in the Participant’s responsibilities, authority or duties; (ii) a material diminution in the Participant’s base salary and cash bonus opportunity; (iii) a change in the geographic location at which the Participant provides services to the Company by at least 50 miles; or (iv) a material breach by the Company of this Agreement. “Good Reason Process” shall mean that (A) the Participant reasonably determines in good faith that a “Good Reason” condition has occurred; (B) the Participant notifies the Company in writing of the first occurrence of the Good Reason condition within 30 days of the first occurrence of such condition; (C) the Participant cooperates in good faith with the

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Company’s efforts, if any, for a period not less than 30 days following such notice (the “Cure Period”), to remedy the condition; (D) notwithstanding such efforts, the Good Reason condition continues to exist; and (E) the Participant terminates his or her employment within 60 days after the end of the Cure Period. If the Company cures the Good Reason condition during the Cure Period, Good Reason shall be deemed not to have occurred.

(f)    “Partial Service Factor” means a factor carried out to the sixth decimal to be used in calculating the number of LTIP Units earned pursuant to Section 2(b) hereof in the event of a Qualified Termination of the Participant’s continuous service prior to the Measurement Date, determined by dividing (a) the number of calendar days that have elapsed since the Grant Date to and including the date of the Participant’s Qualified Termination by (b) the number of calendar days from the Grant Date to and including the Measurement Date.

(g)    “Person” means any individual, entity or group within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended, other than (i) employee benefit plans sponsored or maintained by the Company and by entities controlled by the Company (ii) an underwriter of the Common Stock in a registered public offering or (iii) any entity owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of the Common Stock.

8.    Restrictions on Transfer. None of the Award LTIP Units granted hereunder nor any of the units of the Partnership into which such Award LTIP Units may be converted (the “Award Common Units”) shall be sold, assigned, transferred, pledged, hypothecated, given away or in any other manner disposed of, or encumbered, whether voluntarily or by operation of law or by conversion into units of the Partnership (each such action a “Transfer”) until the later of the date (a) the Earned LTIP Units vest and (b) is two (2) years after the applicable Grant Date. From and after such date, any Transfer of Earned LTIP Units or Award Common Units shall be in accordance with the provisions of the LP Agreement. Additionally, all Transfers of Earned LTIP Units or Award Common Units must be in compliance with all applicable securities laws (including, without limitation, the Securities Act of 1933, as amended, the “Securities Act”). In connection with any Transfer of Earned LTIP Units or Award Common Units, the Partnership may require the Participant to provide an opinion of counsel, satisfactory to the Partnership, that such Transfer is in compliance with all federal and state securities laws (including, without limitation, the Securities Act). Any attempted Transfer of LTIP Units or Award Common Units not in accordance with the terms and conditions of this Section 8 shall be null and void, and the Partnership shall not reflect on its records any change in record ownership of any LTIP Units or Award Common Units as a result of any such Transfer, shall otherwise refuse to recognize any such Transfer and shall not in any way give effect to any such Transfer of any LTIP Units or Award Common Units. Except as otherwise provided herein, this Agreement is personal to the Participant, is non-assignable and is not transferable in any manner, by operation of law or otherwise, other than by will or the laws of descent and distribution.

9.    Legend. The records of the Partnership and any other documentation evidencing the Award LTIP Units shall bear an appropriate legend, as determined by the Partnership in its sole discretion, to the effect that such LTIP Units are subject to restrictions as set forth herein and in the LP Agreement.

10.    Tax Matters; Section 83(b) Election. The Participant may make an election to include in gross income in the year of transfer the fair market value of the Award LTIP Units hereunder pursuant to Section 83(b) of the Code.

11.    Withholding and Taxes. No later than the date as of which an amount first becomes includible in the gross income of the Participant for income tax purposes or subject to the Federal

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Insurance Contributions Act withholding with respect to the Award LTIP Units granted hereunder, the Participant will pay to the Company or, if appropriate, any of its Subsidiaries, or make arrangements satisfactory to the Committee regarding the payment of, any United States federal, state or local or foreign taxes of any kind required by law to be withheld with respect to such amount. The Company may cause the required minimum tax withholding obligation to be satisfied, in whole or in part, by withholding from Award LTIP Units granted to the Participant with an aggregate value that would satisfy the withholding amount due. The obligations of the Company under this Agreement will be conditional on such payment or arrangements, and the Company and its Subsidiaries shall, to the extent permitted by law, have the right to deduct any such taxes from any payment otherwise due to the Participant.

12.    Amendment; Modification. This Agreement may only be modified or amended in a writing signed by the parties hereto, provided that the Participant acknowledges that this Agreement may be amended or canceled by the Committee, on behalf of the Company and the Partnership, in each case for the purpose of satisfying changes in law or for any other lawful purpose, so long as no such action shall adversely affect the Participant’s rights under this Agreement without the Participant’s written consent. No promises, assurances, commitments, agreements, undertakings or representations, whether oral, written, electronic or otherwise, and whether express or implied, with respect to the subject matter hereof, have been made by the parties which are not set forth expressly in this Agreement. The failure of the Participant or the Company or the Partnership to insist upon strict compliance with any provision of this Agreement, or to assert any right the Participant or the Company or the Partnership, respectively, may have under this Agreement, shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.

13.    Complete Agreement. Other than as specifically stated herein or as otherwise set forth in any employment, change in control or other agreement or arrangement to which the Participant is a party which specifically refers to the Award LTIP Units or to the treatment of compensatory equity held by the Participant generally, this Agreement (together with those agreements and documents expressly referred to herein, for the purposes referred to herein) embody the complete and entire agreement and understanding between the parties with respect to the subject matter hereof, and supersede any and all prior promises, assurances, commitments, agreements, undertakings or representations, whether oral, written, electronic or otherwise, and whether express or implied, which may relate to the subject matter hereof in any way.

14.    Investment Representation; Registration. The Participant hereby warrants and represents to and agrees with the Company as follows:

(a)    The LTIP Units issued pursuant to this Agreement will be acquired for the account of the Participant for investment only and not with a view to, nor with any intention of, a distribution or resale thereof, in whole or in part, or the grant of any participation therein. The Participant acknowledges that the issuance of the LTIP Units has not been, and will not be, registered under the Securities Act, and the rules and regulations thereunder, or the securities or real estate syndication laws of any state or other jurisdiction, and cannot be disposed of unless they are subsequently registered under the Securities Act and any applicable laws of states or other jurisdictions or an exemption from such registration is available. The Participant acknowledges that the Company does not have any intention of registering the resale of any LTIP Units issued hereunder under the Securities Act or of supplying the information necessary for the Participant to sell any such LTIP Units; and that the Company and the Partnership shall be organized and operated so as to be exempt from registration under the Investment Company Act of 1940, as amended, and from the provisions of that statute designed to protect investors.

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(b)    The Participant also understands that the transfer of any LTIP Units issued pursuant to this Agreement will be subject to restrictions contained in the LP Agreement, as well as the restrictions set forth in this Agreement.

(c)    The Participant acknowledges that (i) he or she has no obligation whatsoever to acquire the LTIP Units issued pursuant to this Agreement, (ii) his or her acquisition of the LTIP Units issued pursuant to this Agreement is not, and will not be, in any way whatsoever a condition of continued employment with the Company or any entity affiliated with the Company, (iii) neither the offer to the Participant of the opportunity to acquire the LTIP Units or any shares of Common Stock issued pursuant to this Agreement nor this Agreement, shall be deemed to constitute a contract of employment or to impose any obligation upon the Company or any of its affiliates to continue to employ the Participant, and (iv) nothing stated or implied in this Agreement, in the LP Agreement shall be construed to abrogate, amend or otherwise affect any rights or obligations with respect to employment which the Company or any of its affiliates or the Participant may otherwise have by agreement or under law.

(d)    The Participant acknowledges that he or she has been furnished a copy of the LP Agreement, has carefully read and understands the provisions of the LP Agreement, has had the opportunity to ask questions of the Company and has received answers from the Company concerning the provisions of the LP Agreement, and the terms and conditions of the offering of the LTIP Units. The Participant further acknowledges that he or she has been furnished information regarding the activities of the Company, has had the opportunity to ask questions of the Company concerning such activities, and is satisfied with all such information and such answers as he or she has received. The Participant acknowledges that no representation has been made by the Company otherwise by or on behalf of the Company as to any current value of the assets held by the Company or as to any prospective return on any LTIP Units issued pursuant to this Agreement. The Participant further acknowledges that he or she has not relied, in connection with the acquisition of the LTIP Units, upon any representations, warranties or agreements other than those set forth in this Agreement or the LP Agreement. The Participant further acknowledges that he or she provides services to the Company on a regular basis and that, in such capacity, the Participant has access to all such information, and has such experience and involvement in connection with the business and operations of the Company, as the Participant believes to be necessary and appropriate to make an informed decision to accept the LTIP Units granted pursuant to this Agreement.

(e)    The Participant acknowledges that neither the Company nor any of its affiliates is rendering any tax, legal or financial advice or recommendation to acquire the LTIP Units issued pursuant to this Agreement. The Participant has been informed that he or she should consult his or her own tax, legal and financial advisors to the extent the Participant seeks advice regarding these matters.

(f)    The Participant makes the representation regarding his or her status as an “accredited investor” as defined in Rule 501(a) of Regulation D promulgated under the Securities Act as set forth below the Participant’s name on the signature page hereto.

(g)    So long as the Participant holds LTIP Units, the Participant shall disclose to the Company in writing such information as may be reasonably requested with respect to direct or indirect ownership of any LTIP Units issued pursuant to this Agreement as the Company may deem reasonably necessary to ascertain and to establish compliance with provisions of the Code, applicable to the Company or to comply with requirements of any other appropriate taxing authority.

(h)    The Participant shall indemnify and hold the Company harmless from and against any and all loss, cost, damage or liability due to or arising out of a breach of any representation, warranty or agreement of the Participant in this Agreement or any other document furnished by it to the Company in connection with this Award, including, without limitation, the LP Agreement.

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15.    No Obligation to Continue Employment. Neither the Company nor any Subsidiary is obligated by or as a result of this Agreement to continue the Participant in employment and this Agreement shall not interfere in any way with the right of the Company or any Subsidiary to terminate the employment of the Participant at any time.

16.    No Limit on Other Compensation Arrangements. Nothing contained in this Agreement shall preclude the Company from adopting or continuing in effect other or additional compensation plans, agreements or arrangements, and any such plans, agreements and arrangements may be either generally applicable or applicable only in specific cases or to specific persons.

17.    Status of Award LTIP Units. The Company will have the right at its option, as set forth in the LP Agreement, to issue shares of Common Stock in exchange for partnership units into which Award LTIP Units may have been converted pursuant to the LP Agreement, subject to certain limitations set forth in the LP Agreement. The Participant acknowledges that the Participant will have no right to approve or disapprove such election by the Company.

18.    Severability. If any term or provision of this Agreement is or becomes or is deemed to be invalid, illegal or unenforceable in any jurisdiction or under any applicable law, rule or regulation, then such provision shall be construed or deemed amended to conform to applicable law (or if such provision cannot be so construed or deemed amended without materially altering the purpose or intent of this Agreement and the grant of Award LTIP Units hereunder, such provision shall be stricken as to such jurisdiction and the remainder of this Agreement and the award hereunder shall remain in full force and effect).

19.    Law Governing. This Agreement shall be governed by and construed in accordance with the laws of the State of Utah, without regard to any principles of conflicts of law which could cause the application of the laws of any jurisdiction other than the State of Utah.

20.    Headings. Section, paragraph and other headings and captions are provided solely as a convenience to facilitate reference. Such headings and captions shall not be deemed in any way material or relevant to the construction, meaning or interpretation of this Agreement or any term or provision hereof.

21.    Notices. Notices hereunder shall be mailed or delivered to the Company addressed to Cottonwood Communities, Inc., 6340 South 3000 East, Suite 500, Salt Lake City, UT 84121, Attention: General Counsel, and shall be mailed or delivered to the Participant at the address on file with the Company or, in either case, at such other address as one party may subsequently furnish to the other party in writing.

22.    Counterparts. This Agreement may be executed in two or more separate counterparts, each of which shall be an original, and all of which together shall constitute one and the same agreement.

23.    Successors and Assigns. The rights and obligations created hereunder shall be binding on the Participant and his or her heirs and legal representatives and on the successors and assigns of the Partnership.

24.    Data Privacy Consent. In order to administer this Agreement and to implement or structure future equity grants, the Company and its agents may process any and all personal or

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professional data, including but not limited to Social Security or other identification number, home address and telephone number, date of birth and other information that is necessary or desirable for the administration of this Agreement (the “Relevant Information”). By entering into this Agreement, the Participant (i) authorizes the Company to collect, process, register and transfer to its agents all Relevant Information; and (ii) authorizes the Company and its agents to store and transmit such information in electronic form. The Participant shall have access to, and the right to change, the Relevant Information. Relevant Information will only be used in accordance with applicable law and to the extent necessary to administer this Agreement, and the Company and its agents will keep the Relevant Information confidential except as specifically authorized under this paragraph.

25.    Electronic Delivery of Documents. By accepting this Agreement, the Participant (i) consents to the electronic delivery of this Agreement, all information with respect to the Plan and any reports of the Company provided generally to the Company’s stockholders; (ii) acknowledges that he or she may receive from the Company a paper copy of any documents delivered electronically at no cost to the Participant by contacting the Company by telephone or in writing; (iii) further acknowledges that he or she may revoke his or her consent to electronic delivery of documents at any time by notifying the Company of such revoked consent by telephone, postal service or electronic mail; and (iv) further acknowledges that he or she is not required to consent to electronic delivery of documents.

[Remainder of the page intentionally left blank]

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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date first set forth above.

COTTONWOOD COMMUNITIES, INC.

By:

Name:

Title:

COTTONWOOD COMMUNITIES O.P., L.P.

By: COTTONWOOD COMMUNITIES, INC., its General Partner

        By:

        Name:

        Title:

PARTICIPANT

By:

Name:

Address:

Section 14(f) Representation. Please initial or check ALL of the boxes which correctly describe the Participant.

☐ The Participant is a natural person: (i) whose individual net worth (assets minus liabilities), or joint net worth with that person’s spouse, exceeds $1,000,000 ((a) excluding (1) as an asset, the value of such natural person’s primary residence and (2) as a liability, the outstanding indebtedness secured by such natural person’s primary residence up to the fair market value of such primary residence, provided, however, that if the amount of such outstanding indebtedness has increased within the previous 60 days, other than as a result of the acquisition of the primary residence, the amount of such excess shall be included as a liability and (b) including, as a liability, the outstanding indebtedness secured by the natural

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person’s primary residence in excess of the fair market value of such primary residence), or (ii) who had an individual income in excess of $200,000 in each of the two most recent years or joint income with the person’s spouse in excess of $300,000 in each of those years and has a reasonable expectation of reaching the same income level in the current year.

☐ The Participant is a natural person who is a director or executive officer (as defined below) of the Company. As used herein, “executive officer” shall mean the president, any vice president in charge of a principal business unit, division or function (such as sales, administration or finance), any other officer who performs a policy-making function, or any other person who performs similar policy-making functions for the Company.

☐ Neither of the prior boxes correctly describes the Participant.

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EXHIBIT A

FORM OF LIMITED PARTNER SIGNATURE PAGE

The Participant, desiring to become one of the within named Limited Partners of Cottonwood Communities O.P., L.P., hereby becomes a party to the Fourth Amended and Restated Limited Partnership Agreement of Cottonwood Communities O.P., L.P., as amended through the date hereof (the “LP Agreement”).

The Participant constitutes and appoints the General Partner and its authorized officers and attorneys-in-fact, and each of those acting singly, in each case with full power of substitution, as the Participant’s true and lawful agent and attorney-in-fact, with full power and authority in the Participant’s name, place and stead to carry out all acts described in Section 8.2 of the LP Agreement, such power of attorney to be irrevocable and a power coupled with an interest pursuant to Section 8.2 of the LP Agreement.

The Participant agrees that this signature page may be attached to any counterpart of the LP Agreement.

Participant:

By:

Name:

Date:

Address of Limited Partner:

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EX-10.20

Exhibit 10.20

COTTONWOOD COMMUNITIES, INC.

FORM OF TIME-BASED

LTIP UNIT AWARD AGREEMENT

Name of the Participant:                      (the “Participant”)

No. of LTIP Units Issued:                     

Grant Date: [            ] [    ], 2020

RECITALS

A.    Cottonwood Communities, Inc., a Maryland corporation (the “Company”) wishes to reward and incentivize the Participant, who performs valuable services for the benefit of the Company and Cottonwood Communities O.P., L.P., a Delaware partnership (the “Partnership” and, together with the Company, “Cottonwood”).

B.    Pursuant to the Amended and Restated Limited Partnership Agreement (as amended and supplemented from time to time, the “LP Agreement”) of the Partnership, the Company hereby grants the Participant this award (the “Award”) and hereby causes the Partnership to issue to the Participant, the number of LTIP Units (as defined in the LP Agreement) set forth above (the “Award LTIP Units”) having the rights, voting powers, restrictions, limitations as to distributions, qualifications and terms and conditions of redemption and conversion set forth herein and in the LP Agreement. Unless otherwise indicated, capitalized terms used herein but not otherwise defined shall have the meanings given to those terms in the LP Agreement.

C.    The Board of Directors of the Company (the “Board”) or the Compensation Committee of the Board (either such entity shall be referred to herein as the “Committee”) has determined that the Participant is entitled to receive the Award LTIP Units.

NOW, THEREFORE, the Company, the Partnership and the Participant agree as follows:

1.    Effectiveness of Award. The Participant shall be admitted as a partner of the Partnership with beneficial ownership of the Award LTIP Units as of the Grant Date by (i) signing and delivering to the Partnership a copy of this Agreement and (ii) signing, as a Limited Partner, and delivering to the Partnership a counterpart signature page to the LP Agreement (attached hereto as Exhibit A). Upon execution of this Agreement by the Participant, the Partnership and the Company, the books and records of the Partnership maintained by the General Partner shall reflect the issuance to the Participant of the Award LTIP Units. Thereupon, the Participant shall have all the rights of a Limited Partner of the Partnership with respect to a number of LTIP Units equal to the Award LTIP Units, subject, however, to the restrictions and conditions specified in Section 2 below and elsewhere herein. The LTIP Units are uncertificated securities of the Partnership and upon the Participant’s request the General Partner shall confirm the number of LTIP Units issued to the Participant.

2.    Vesting of Award LTIP Units. The Award LTIP Units shall become vested on the Vesting Date or Dates specified in the following schedule so long as the Participant remains an employee of the Employer on such Dates. If a series of Vesting Dates is specified, then the Award LTIP Units shall become vested only with respect to the number of Award LTIP Units specified as vested on each such date. There shall be no proportionate or partial vesting of Award LTIP Units in or during the months, days or periods between each Vesting Date.

Vesting Dates	Number of Units Vesting Per Year		Percent of Units Vested
January 1, 20XX		XX		25	%
January 1, 20XX		XX		50	%
January 1, 20XX		XX		75	%
January 1, 20XX		XX		100	%
Total Vesting		XXX		100	%

In the event of termination of the Participant’s employment (a) by the Participant for Good Reason, (b) by the Company without Cause or (c) by reason of the Participant’s death or disability, the Participant shall become fully vested in all of his or her Award LTIP Units. If the Participant’s employment with the Employer terminates for any other reason, any Award LTIP Units held by the Participant that have not vested as of such date shall automatically and without notice terminate and be terminated and neither the Participant nor any of his or her successors, heirs, assigns or personal representatives will thereafter have any further rights or interests in such unvested Award LTIP Units. The Participant shall retain his or her right to any vested Award LTIP Units.

Notwithstanding anything herein to the contrary, to the extent the Participant is party to an employment agreement with the Employer that provides for the treatment of unvested equity awards in certain employment terminations, and subject to compliance by the Participant with the requirements of such employment agreement related to such termination, the vesting of any unvested Award LTIP Units shall be subject to the terms of such employment agreement.

In the event of the occurrence of a Change in Control, all outstanding Award LTIP Units shall become fully vested.

(a)    Distributions. The LTIP Unit Distribution Participation Date with respect to the Award LTIP Units is the Grant Date and distributions shall be paid to the Participant to the extent provided for in the LP Agreement. Distributions paid on an Award LTIP Units will equal the distribution paid on the Common Units at the time the distribution is paid. For the avoidance of doubt, all distributions paid with respect to Award LTIP Units shall be fully vested and non-forfeitable.

3.    Adjustments. The Award LTIP Units shall be subject to adjustment in the circumstances described in and in accordance with the LP Agreement.

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4.    Compensation Recoupment Policy. This Award shall be subject to any compensation recoupment policy of the Company that is applicable by its terms to the Participant and to Awards of this type.

5.    Interpretation by Committee. This Agreement is subject in all respects to the terms, conditions, limitations and definitions contained in the LP Agreement. In the event of any discrepancy or inconsistency between this Agreement and the LP Agreement, the terms and conditions of the LP Agreement shall control except that in the case of a Change in Control, the provisions of this Agreement shall control. The Committee may make such rules and regulations and establish such procedures for the administration of this Agreement as it deems appropriate. Without limiting the generality of the foregoing, the Committee may interpret this Agreement, with such interpretations to be conclusive and binding on all persons and otherwise accorded the maximum deference permitted by law. In the event of any dispute or disagreement as to interpretation of the Agreement or of any rule, regulation or procedure, or as to any question, right or obligation arising from or related to this Agreement, the decision of the Committee shall be final and binding upon all persons.

6.    Defined Terms. For purposes of this Agreement, the following defined terms shall have the meanings specified herein:

(a)    “Cause” means (a) if the Participant is a party to an employment agreement with the Employer, and “Cause” is defined therein, such definition, or (b) if the Participant is not party to an employment agreement that defines “Cause,” Cause shall mean, (i) conduct by the Participant which would reasonably be expected to result in material injury or reputation harm to the Employer; (ii) conduct by the Participant constituting gross negligence or willful misconduct in the performance of his or her duties; (iii) the material violation by the Participant of any written policy and ethics, as in effect on the Grant Date and as subsequently changed from time to time; or (iv) the commission by the Participant of any felony or a misdemeanor involving moral turpitude, deceit, dishonesty or fraud.

(b)    “Change in Control” means: (i) the acquisition in one or more transactions by any Person, of the beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as amended) of 50% or more of (A) the then outstanding shares of Common Stock, or (B) the combined voting power of the then outstanding securities of the Company entitled to vote generally in the election of directors; (ii) the closing of a sale or other conveyance of all or substantially all of the assets of the Company or the Partnership other than a sale or other conveyance by the Company to an entity at least 50% of the combined voting power of the voting securities of which are owned by the stockholders of the Company in substantially the same proportion as their ownership of the Common Stock immediately prior to such sale or other conveyance; (iii) the effective time of any merger, share exchange, consolidation, or other business combination involving the Company or a direct or indirect subsidiary of the Company that results in the voting securities of the Company outstanding immediately prior to such transaction representing (either by remaining outstanding or by being converted into voting securities of the surviving entity or its parent) less than 50% of the combined voting power of the securities of the surviving entity or its parent outstanding immediately after such transaction and (iv) a Capital Transaction. For the avoidance of doubt, an initial public offering of Common Stock shall not be considered a Change in Control for purposes of this Agreement.

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(c)    “Common Stock” means shares of common stock of the Company.

(d)    “Employer” means either the Company, the Partnership or any affiliate that employs the Participant.

(e)    “Good Reason” means (a) if the Participant is party to an employment agreement with the Employer, and “Good Reason” is defined therein, such definition, or (b) if the Participant is not party to an employment agreement that defines “Good Reason,” Good Reason shall mean that the Participant has complied with the “Good Reason Process” (hereinafter defined) following the occurrence of any of the following events: (i) a material diminution in the Participant’s responsibilities, authority or duties; (ii) a material diminution in the Participant’s base salary and cash bonus opportunity; (iii) a change in the geographic location at which the Participant provides services to the Company by at least 50 miles; or (iv) a material breach by the Company of this Agreement. “Good Reason Process” shall mean that (A) the Participant reasonably determines in good faith that a “Good Reason” condition has occurred; (B) the Participant notifies the Company in writing of the first occurrence of the Good Reason condition within 30 days of the first occurrence of such condition; (C) the Participant cooperates in good faith with the Company’s efforts, if any, for a period not less than 30 days following such notice (the “Cure Period”), to remedy the condition; (D) notwithstanding such efforts, the Good Reason condition continues to exist; and (E) the Participant terminates his or her employment within 60 days after the end of the Cure Period. If the Company cures the Good Reason condition during the Cure Period, Good Reason shall be deemed not to have occurred.

(f)    “Person” means any individual, entity or group within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended, other than (i) employee benefit plans sponsored or maintained by the Company and by entities controlled by the Company (ii) an underwriter of the Common Stock in a registered public offering or (iii) any entity owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of the Common Stock.

7.    Restrictions on Transfer. None of the Award LTIP Units granted hereunder nor any of the units of the Partnership into which such Award LTIP Units may be converted (the “Award Common Units”) shall be sold, assigned, transferred, pledged, hypothecated, given away or in any other manner disposed of, or encumbered, whether voluntarily or by operation of law or by conversion into units of the Partnership (each such action a “Transfer”) until the later of the date that (a) the Award LTIP Units vest and (b) is two (2) years after the Grant Date. From and after such date, any Transfer of Award LTIP Units or Award Common Units shall be in accordance with the provisions of the LP Agreement. Additionally, all Transfers of Award LTIP Units or Award Common Units must be in compliance with all applicable securities laws (including, without limitation, the Securities Act of 1933, as amended, the “Securities Act”). In connection with any Transfer of Award LTIP Units or Award Common Units, the Partnership may require the Participant to provide an opinion of counsel, satisfactory to the Partnership, that such Transfer is in compliance with all federal and state securities laws (including, without limitation, the Securities Act). Any attempted Transfer of Award LTIP Units or Award Common

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Units not in accordance with the terms and conditions of this Section 8 shall be null and void, and the Partnership shall not reflect on its records any change in record ownership of any Award LTIP Units or Award Common Units as a result of any such Transfer, shall otherwise refuse to recognize any such Transfer and shall not in any way give effect to any such Transfer of any Award LTIP Units or Award Common Units. Except as otherwise provided herein, this Agreement is personal to the Participant, is non-assignable and is not transferable in any manner, by operation of law or otherwise, other than by will or the laws of descent and distribution.

8.    Legend. The records of the Partnership and any other documentation evidencing the Award LTIP Units shall bear an appropriate legend, as determined by the Partnership in its sole discretion, to the effect that such LTIP Units are subject to restrictions as set forth herein and in the LP Agreement.

9.    Tax Matters; Section 83(b) Election. The Participant may make an election to include in gross income in the year of transfer the fair market value of the unvested Award LTIP Units hereunder pursuant to Section 83(b) of the Code substantially in the form attached hereto as Exhibit B and to supply the necessary information in accordance with the regulations promulgated thereunder.

10.    Withholding and Taxes. No later than the date as of which an amount first becomes includible in the gross income of the Participant for income tax purposes or subject to the Federal Insurance Contributions Act withholding with respect to the Award LTIP Units granted hereunder, the Participant will pay to the Company or, if appropriate, any of its Subsidiaries, or make arrangements satisfactory to the Committee regarding the payment of, any United States federal, state or local or foreign taxes of any kind required by law to be withheld with respect to such amount. The Company may cause the required minimum tax withholding obligation to be satisfied, in whole or in part, by withholding from Award LTIP Units granted to the Participant with an aggregate value that would satisfy the withholding amount due. The obligations of the Company under this Agreement will be conditional on such payment or arrangements, and the Company and its Subsidiaries shall, to the extent permitted by law, have the right to deduct any such taxes from any payment otherwise due to the Participant.

11.    Amendment; Modification. This Agreement may only be modified or amended in a writing signed by the parties hereto, provided that the Participant acknowledges that this Agreement may be amended or canceled by the Committee, on behalf of the Company and the Partnership, in each case for the purpose of satisfying changes in law or for any other lawful purpose, so long as no such action shall adversely affect the Participant’s rights under this Agreement without the Participant’s written consent. No promises, assurances, commitments, agreements, undertakings or representations, whether oral, written, electronic or otherwise, and whether express or implied, with respect to the subject matter hereof, have been made by the parties which are not set forth expressly in this Agreement. The failure of the Participant or the Company or the Partnership to insist upon strict compliance with any provision of this Agreement, or to assert any right the Participant or the Company or the Partnership, respectively, may have under this Agreement, shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.

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12.    Complete Agreement. Other than as specifically stated herein or as otherwise set forth in any employment, change in control or other agreement or arrangement to which the Participant is a party which specifically refers to the Award LTIP Units or to the treatment of compensatory equity held by the Participant generally, this Agreement (together with those agreements and documents expressly referred to herein, for the purposes referred to herein) embody the complete and entire agreement and understanding between the parties with respect to the subject matter hereof, and supersede any and all prior promises, assurances, commitments, agreements, undertakings or representations, whether oral, written, electronic or otherwise, and whether express or implied, which may relate to the subject matter hereof in any way.

13.    Investment Representation; Registration. The Participant hereby warrants and represents to and agrees with the Company as follows:

(a)    The LTIP Units issued pursuant to this Agreement will be acquired for the account of the Participant for investment only and not with a view to, nor with any intention of, a distribution or resale thereof, in whole or in part, or the grant of any participation therein. The Participant acknowledges that the issuance of the LTIP Units has not been, and will not be, registered under the Securities Act, and the rules and regulations thereunder, or the securities or real estate syndication laws of any state or other jurisdiction, and cannot be disposed of unless they are subsequently registered under the Securities Act and any applicable laws of states or other jurisdictions or an exemption from such registration is available. The Participant acknowledges that the Company does not have any intention of registering the resale of any LTIP Units issued hereunder under the Securities Act or of supplying the information necessary for the Participant to sell any such LTIP Units; and that the Company and the Partnership shall be organized and operated so as to be exempt from registration under the Investment Company Act of 1940, as amended, and from the provisions of that statute designed to protect investors.

(b)    The Participant also understands that the transfer of any LTIP Units issued pursuant to this Agreement will be subject to restrictions contained in the LP Agreement, as well as the restrictions set forth in this Agreement.

(c)    The Participant acknowledges that (i) he or she has no obligation whatsoever to acquire the LTIP Units issued pursuant to this Agreement, (ii) his or her acquisition of the LTIP Units issued pursuant to this Agreement is not, and will not be, in any way whatsoever a condition of continued employment with the Company or any entity affiliated with the Company, (iii) neither the offer to the Participant of the opportunity to acquire the LTIP Units or any shares of Common Stock issued pursuant to this Agreement nor this Agreement, shall be deemed to constitute a contract of employment or to impose any obligation upon the Company or any of its affiliates to continue to employ the Participant, and (iv) nothing stated or implied in this Agreement, in the LP Agreement shall be construed to abrogate, amend or otherwise affect any rights or obligations with respect to employment which the Company or any of its affiliates or the Participant may otherwise have by agreement or under law.

(d)    The Participant acknowledges that he or she has been furnished a copy of the LP Agreement, has carefully read and understands the provisions of the LP Agreement, has had the opportunity to ask questions of the Company and has received answers from the Company concerning the provisions of the LP Agreement, and the terms and conditions of the

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offering of the LTIP Units. The Participant further acknowledges that he or she has been furnished information regarding the activities of the Company, has had the opportunity to ask questions of the Company concerning such activities, and is satisfied with all such information and such answers as he or she has received. The Participant acknowledges that no representation has been made by the Company otherwise by or on behalf of the Company as to any current value of the assets held by the Company or as to any prospective return on any LTIP Units issued pursuant to this Agreement. The Participant further acknowledges that he or she has not relied, in connection with the acquisition of the LTIP Units, upon any representations, warranties or agreements other than those set forth in this Agreement or the LP Agreement. The Participant further acknowledges that he or she provides services to the Company on a regular basis and that, in such capacity, the Participant has access to all such information, and has such experience and involvement in connection with the business and operations of the Company, as the Participant believes to be necessary and appropriate to make an informed decision to accept the LTIP Units granted pursuant to this Agreement.

(e)    The Participant acknowledges that neither the Company nor any of its affiliates is rendering any tax, legal or financial advice or recommendation to acquire the LTIP Units issued pursuant to this Agreement. The Participant has been informed that he or she should consult his or her own tax, legal and financial advisors to the extent the Participant seeks advice regarding these matters.

(f)    The Participant makes the representation regarding his or her status as an “accredited investor” as defined in Rule 501(a) of Regulation D promulgated under the Securities Act as set forth below the Participant’s name on the signature page hereto.

(g)    So long as the Participant holds LTIP Units, the Participant shall disclose to the Company in writing such information as may be reasonably requested with respect to direct or indirect ownership of any LTIP Units issued pursuant to this Agreement as the Company may deem reasonably necessary to ascertain and to establish compliance with provisions of the Code, applicable to the Company or to comply with requirements of any other appropriate taxing authority.

(h)    The Participant shall indemnify and hold the Company harmless from and against any and all loss, cost, damage or liability due to or arising out of a breach of any representation, warranty or agreement of the Participant in this Agreement or any other document furnished by it to the Company in connection with this Award, including, without limitation, the LP Agreement.

14.    No Obligation to Continue Employment. Neither the Company nor any Subsidiary is obligated by or as a result of this Agreement to continue the Participant in employment and this Agreement shall not interfere in any way with the right of the Company or any Subsidiary to terminate the employment of the Participant at any time.

15.    No Limit on Other Compensation Arrangements. Nothing contained in this Agreement shall preclude the Company from adopting or continuing in effect other or additional compensation plans, agreements or arrangements, and any such plans, agreements and arrangements may be either generally applicable or applicable only in specific cases or to specific persons.

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16.    Status of Award LTIP Units. The Company will have the right at its option, as set forth in the LP Agreement, to issue shares of Common Stock in exchange for partnership units into which Award LTIP Units may have been converted pursuant to the LP Agreement, subject to certain limitations set forth in the LP Agreement. The Participant acknowledges that the Participant will have no right to approve or disapprove such election by the Company.

17.    Severability. If any term or provision of this Agreement is or becomes or is deemed to be invalid, illegal or unenforceable in any jurisdiction or under any applicable law, rule or regulation, then such provision shall be construed or deemed amended to conform to applicable law (or if such provision cannot be so construed or deemed amended without materially altering the purpose or intent of this Agreement and the grant of Award LTIP Units hereunder, such provision shall be stricken as to such jurisdiction and the remainder of this Agreement and the award hereunder shall remain in full force and effect).

18.    Law Governing. This Agreement shall be governed by and construed in accordance with the laws of the State of Utah, without regard to any principles of conflicts of law which could cause the application of the laws of any jurisdiction other than the State of Utah.

19.    Headings. Section, paragraph and other headings and captions are provided solely as a convenience to facilitate reference. Such headings and captions shall not be deemed in any way material or relevant to the construction, meaning or interpretation of this Agreement or any term or provision hereof.

20.    Notices. Notices hereunder shall be mailed or delivered to the Company addressed to Cottonwood Communities, Inc., 6340 South 3000 East, Suite 500, Salt Lake City, UT 84121, Attention: General Counsel, and shall be mailed or delivered to the Participant at the address on file with the Company or, in either case, at such other address as one party may subsequently furnish to the other party in writing.

21.    Counterparts. This Agreement may be executed in two or more separate counterparts, each of which shall be an original, and all of which together shall constitute one and the same agreement.

22.    Successors and Assigns. The rights and obligations created hereunder shall be binding on the Participant and his or her heirs and legal representatives and on the successors and assigns of the Partnership.

23.    Data Privacy Consent. In order to administer this Agreement and to implement or structure future equity grants, the Company and its agents may process any and all personal or professional data, including but not limited to Social Security or other identification number, home address and telephone number, date of birth and other information that is necessary or desirable for the administration of this Agreement (the “Relevant Information”). By entering into this Agreement, the Participant (i) authorizes the Company to collect, process, register and transfer to its agents all Relevant Information; and (ii) authorizes the Company and its agents to store and transmit such information in electronic form. The Participant shall have access to, and

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the right to change, the Relevant Information. Relevant Information will only be used in accordance with applicable law and to the extent necessary to administer this Agreement, and the Company and its agents will keep the Relevant Information confidential except as specifically authorized under this paragraph.

24.    Electronic Delivery of Documents. By accepting this Agreement, the Participant (i) consents to the electronic delivery of this Agreement, all information with respect to the Plan and any reports of the Company provided generally to the Company’s stockholders; (ii) acknowledges that he or she may receive from the Company a paper copy of any documents delivered electronically at no cost to the Participant by contacting the Company by telephone or in writing; (iii) further acknowledges that he or she may revoke his or her consent to electronic delivery of documents at any time by notifying the Company of such revoked consent by telephone, postal service or electronic mail; and (iv) further acknowledges that he or she is not required to consent to electronic delivery of documents.

[Remainder of the page intentionally left blank]

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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date first set forth above.

COTTONWOOD COMMUNITIES, INC.

By:

Name:

Title:

COTTONWOOD COMMUNITIES O.P., L.P.

By: COTTONWOOD COMMUNITIES, INC., its General Partner

        By:

        Name:

        Title:

PARTICIPANT

By:

Name:

Address:

Section 14(f) Representation. Please initial or check ALL of the boxes which correctly describe the Participant.

☐ The Participant is a natural person: (i) whose individual net worth (assets minus liabilities), or joint net worth with that person’s spouse, exceeds $1,000,000 ((a) excluding (1) as an asset, the value of such natural person’s primary residence and (2) as a liability, the outstanding indebtedness secured by such natural person’s primary residence up to the fair market value of such primary residence, provided, however,

10

that if the amount of such outstanding indebtedness has increased within the previous 60 days, other than as a result of the acquisition of the primary residence, the amount of such excess shall be included as a liability and (b) including, as a liability, the outstanding indebtedness secured by the natural person’s primary residence in excess of the fair market value of such primary residence), or (ii) who had an individual income in excess of $200,000 in each of the two most recent years or joint income with the person’s spouse in excess of $300,000 in each of those years and has a reasonable expectation of reaching the same income level in the current year.

☐ The Participant is a natural person who is a director or executive officer (as defined below) of the Company. As used herein, “executive officer” shall mean the president, any vice president in charge of a principal business unit, division or function (such as sales, administration or finance), any other officer who performs a policy-making function, or any other person who performs similar policy-making functions for the Company.

☐ Neither of the prior boxes correctly describes the Participant.

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EXHIBIT A

FORM OF LIMITED PARTNER SIGNATURE PAGE

The Participant, desiring to become one of the within named Limited Partners of Cottonwood Communities O.P., L.P., hereby becomes a party to the Amended and Restated Limited Partnership Agreement of Cottonwood Communities O.P., L.P., as amended through the date hereof (the “LP Agreement”).

The Participant constitutes and appoints the General Partner and its authorized officers and attorneys-in-fact, and each of those acting singly, in each case with full power of substitution, as the Participant’s true and lawful agent and attorney-in-fact, with full power and authority in the Participant’s name, place and stead to carry out all acts described in Section 8.2 of the LP Agreement, such power of attorney to be irrevocable and a power coupled with an interest pursuant to Section 8.2 of the LP Agreement.

The Participant agrees that this signature page may be attached to any counterpart of the LP Agreement.

Participant:

By:

Name:

Date:

Address of Limited Partner:

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EXHIBIT B

Section 83(b) Election¹

The undersigned hereby elects pursuant to §83(b) of the Internal Revenue Code of 1986, as amended, to include in gross income as compensation for services the excess (if any) of the fair market value of the units described below over the amount paid for those shares.

1. The name, taxpayer identification number, address of the undersigned, and the taxable year for which this election is being made are:

Taxpayer’s Name:                                                                                                                                                                                                                  

Taxpayer’s Social Security Number:                                                                                                                                                                                    

Address:                                                                                                                                                                                                                                 

Taxable Year: Calendar Year 201    

2. The property which is the subject of this election is                      LTIP Units in Cottonwood Communities O.P., L.P.

3. The property was transferred to the undersigned on                     , 201    .

4. The property is subject to the following restrictions:

The LTIP Units will be subject to restrictions on transfer and risk of forfeiture upon termination of service relationship and in certain other events

5. The fair market value of the property at time of transfer (determined without regard to any restrictions other than nonlapse restrictions as defined in §1.83-3(h) of the Income Tax Regulations) is $0.

6. For the property transferred, the undersigned paid $0.

7. The amount to include in gross income is $0.

¹ The 83(b) Election must be filed no later than 30 days after the date on which the property is transferred. The IRS has indicated that the election form should be sent to the IRS address listed for the taxpayer’s state under “Are you requesting a refund or are not enclosing a check or money order...” given in Where Do You File in the Instructions for Form 1040 and the Instructions for Form 1040A (this information can also be found by looking up your state at: https://www.irs.gov/filing/where-to-file-addresses-for-taxpayers-and-tax-professionals-filing-form-1040).

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The undersigned taxpayer will file this election with the Internal Revenue Service Office with which the taxpayer files his or her annual income tax return not later than 30 days after the date of transfer of the property. A copy of the election will also be furnished to the person for whom the services were performed. Additionally, the undersigned will include a copy of the election with his or her income tax return for the taxable year in which the property is transferred. The undersigned is the person performing services in connection with which the property was transferred.

Dated:             , 201
	Taxpayer

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EX-23.3

Exhibit 23.3

Consent of Independent Registered Public Accounting Firm

The Board of Directors

Cottonwood Communities, Inc.:

We consent to the incorporation by reference in the prospectus related to the registration statement (No. 333-215272) on Form S-11 of Cottonwood Communities, Inc. of our report dated March 25, 2020, with respect to the consolidated balance sheets of Cottonwood Communities, Inc. and subsidiaries as of December 31, 2019 and 2018, and the related consolidated statements of operations, stockholders’ equity, and cash flows for each of the years in the two-year period ended December 31, 2019, and the related notes (collectively, the “consolidated financial statements”), incorporated by reference therein and to the reference to our firm under the heading “Experts” in the prospectus.

/s/ KPMG LLP

Denver, Colorado

April 17, 2020

EX-23.4

Exhibit 23.4

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the incorporation by reference in Post-Effective Amendment No. 5 to the Registration Statement of Cottonwood Communities, Inc. on Form S-11 (File No. 333-215272) of our report dated August 1, 2019, with respect to the historical summary of statements of revenues and certain expenses of Cottonwood West Palm for the year ended December 31, 2018 included in the Current Report on Form 8-K/A filed with the SEC on August 1, 2019, and to the reference to our firm under the heading “Experts” in the prospectus.

/s/ WSRP, LLC

Salt Lake City, Utah

April 17, 2020